Nikkei rises in choppy trade, event risks temper mood
By Joshua Hunt
TOKYO May 31 (Reuters) - Japanese stocks rose in thin, choppy trade on Tuesday morning as growing expectations of an imminent U.S. interest rate hike helped the dollar hold onto recent gains against the yen, burnishing the profit outlook for Japan's exporters.
The Nikkei share average rose 0.6 percent to 17,163.68 in late morning trade. Activity remained subdued as many investors sat on the sidelines awaiting fresh catalysts.
"I think the market remains open to all possibilities right now," said Stefan Worrall, director of Japan equity sales at Credit Suisse.
"We're in a low-turnover state of anticipation over global events like the Brexit vote and the FOMC meeting but also with regard to domestic elements like a possible delay of next year's consumption tax increase and a possible snap election this summer. There's a lot of noise and no clear decisions."
Domestic media reported Prime Minister Abe would make an announcement on Wednesday to address recent reports that he would delay an April 2017 sales tax increase by 2-1/2 years.
Data released earlier in the morning session showed Japanese industrial output unexpectedly rose 0.3 percent in April, suggesting production is holding up despite weak exports and the impact from a series of earthquakes that struck Japan's southern island of Kyushu during that month.
The yen initially strengthened following the data, but later resumed its weakening trend, underpinning automakers and other exporters.
Toyota Motor Corp climbed 2.6 percent in late morning trade while Nissan Motor Co Ltd shares gained 0.8 percent and Honda Motor Co Ltd rose 0.7 percent. Continuación...