Nikkei jumps as bargain-hunting accelerates after China market calms
TOKYO Aug 26 (Reuters) - The Nikkei extended its early gains on Wednesday afternoon as Chinese markets calmed and attractive prices drove buying of major stocks such as big exporters.
The Nikkei was up 3.2 percent to 18,376.47 in mid-afternoon trade after moving in and out of negative territory in the morning. The benchmark fell 13.6 percent, or 2,813 points, in the six sessions through Tuesday.
"We're seeing some buying from bargain hunters and a lot of important China-linked shares seem to be reacting positively to yesterday's move by the PBOC," said Gavin Parry, managing director of Parry International Trading in Hong Kong.
"In the short term it's hard to say whether this is real stability or just another bounce on the way there but the general sentiment is that the Nikkei is still where you want to be in the long term."
Companies which have high exposure to China soared. Fanuc Corp jumped 5.1 percent while other exporters were also chased higher, with Toyota Motor Corp rising 3.6 percent, Nissan Motor Co gaining 4.9 percent and Panasonic Corp soaring 7.2 percent.
On Tuesday, the People's Bank of China cut interest rates and lowered the amount of reserves banks must hold for the second time in two months, ratcheting up support for a stumbling economy and a plunging stock market.
Beijing's easing measures initially failed to stem the rout in Chinese shares, which were down sharply on Wednesday morning but moved into positive territory in the afternoon.
The broader Topix rose 3.2 percent to 1,478.39 and the JPX-Nikkei Index 400 added 3.2 percent to 13,320.50. (Reporting by Joshua Hunt and Ayai Tomisawa; Editing by Eric Meijer)
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