September 14, 2018 / 7:28 AM / 2 months ago

Nikkei posts best weekly gain in 2 months as trade anxiety eases

* China’s upbeat industrial output helps support sentiment

* Investors applaud Turkey’s central bank action - analyst

* Optimism for Japan-U.S. talks rises

By Ayai Tomisawa

TOKYO, Sept 14 (Reuters) - Japan’s Nikkei share average rallied to its highest in more than seven-months on Friday as sentiment improved on signs China and the United States make progress towards resolving their trade disputes.

The Nikkei ended 1.2 percent higher to 23,094.67, the highest closing point since early February.

For the week, the benchmark index jumped 3.5 percent, posting the best weekly performance in two months.

The Japanese market has been under pressure over the past few weeks as worries about global trade frictions dented sentiment, but moves by China and the United States to hold fresh talks over tariffs have brought some buyers into the markets, analysts said.

“There is even optimism for U.S.-Japan trade talks,” said Chisato Haganuma, chief strategist at Mitsubishi UFJ Morgan Stanley Securities.

The Trump administration invited Beijing on Wednesday to a new round of talks, even as Washington prepared to slap tariffs on $200 billion worth of Chinese goods. Beijing has welcomed the invitation.

Mitsubishi’s Haganuma added that a recovery in emerging market currencies is also helping sentiment, after Turkey’s central bank raised its benchmark rate by 625 basis points on Thursday in a move that boosted the lira.

“The market had been worried that no policy decision would be made amid the Turkish crisis. But investors applauded the move by Turkey’s central bank to actually take action by raising interest rates to save the falling currency,” Haganuma said.

Exporters rose as the dollar-yen was steady. The dollar was flat at 111.93 yen after rising to 112.08 yen.

Chip-related shares and machinery stocks gained ground, with Advantest Corp surging 5 percent, Tokyo Electron up 1.6 percent, Yaskawa Electric jumping 7.6 percent and TDK Corp climbing 5.6 percent.

Investors also appeared to be encouraged by China’s upbeat industrial output data for August.

Industrial robot maker Fanuc Corp gained 2.8 percent and Keyence Corp added 5.4 percent.

The broader Topix gained 1.1 percent to 1,728.61. (Reporting by Ayai Tomisawa Editing by Eric Meijer)

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