Nikkei rallies over 2 pct on ECB optimism, Apple earnings; Takata bounces
* Apple-linked shares soar on better-than-expected earnings * Takata recoups losses but it may take time to restore trust - analyst By Ayai Tomisawa TOKYO, Oct 22 (Reuters) - Japanese stocks soared more than 2 percent on Wednesday, as the prospect of the European Central Bank taking further measures to support a faltering economy and strong gains in Apple Inc -related shares eased concerns over slowing global growth. Air bag maker Takata Corp also bounced strongly, recouping some of the deep losses of the previous day after it said any additional costs of repairs for the 4.74 million vehicles subject to U.S. safety regulators would be minimal. The Nikkei share average added 299.27 points to 15,104.31 in mid-morning trade after sliding 2.0 percent on the previous day. Sources told Reuters on Wednesday that the European Central Bank is considering buying corporate bonds on the secondary market and may decide on the matter as soon as December with a view to begin purchases early next year. "The news triggered bargain hunting as Japanese shares have fallen to levels which priced in the worst case scenario," said Toru Ibayashi, executive director at UBS Wealth Management, referring to fears that Europe's economy would fall back into recession. Ibayashi expects the Nikkei to recover its losses posted earlier this month over the coming weeks. "Japanese corporate earnings are seen rising and there are positive factors such as pension fund buying in the market. I've been suggesting that investors buy Japanese shares at their lows and sell at their highs this year, and now is the time to buy." The Nikkei has shed 7.0 percent since the beginning of this month, hurt by fears of recession in the euro zone, slowing growth in China and geopolitical tensions in the Middle East. Apple's Japanese suppliers surged, with Foster Electric Co rising 3.4 percent and Japan Aviation Electronics Industry Ltd gaining 3.5 percent after the maker of iPhone posted stronger-than-expected quarterly earnings. Takata jumped 10 percent on its reassurance about limiting costs from recalls of its airbags which sent the stock diving 23 percent on Tuesday to the lowest since March 2013. Toyota Motor Corp recalled 247,000 cars, SUVs and pickup trucks in the United States on Monday because of potentially defective front passenger air bag inflators from Takata that can rupture and spray metal shrapnel, according to U.S. safety regulators. That raised the number of vehicles affected by regional recalls launched in June by several automakers due to the Takata air bags to more than 4.5 million. "Even though the stock is recouping some of the previous losses, I would not feel comfortable holding the stock in my portfolio yet," said Yoshihiro Okumura, general manager at Chibagin Asset Management. "The stock price will be swayed by upcoming news reports, and it will take time to rebuild trust." The broader Topix gained 1.6 percent to 1,224.99, and the new JPX-Nikkei Index 400 advanced 1.6 percent to 11,144.58. (Editing by Shri Navaratnam)
© Thomson Reuters 2017 All rights reserved.