August 27, 2019 / 6:31 AM / 3 months ago

Tokyo stocks rebound on Trump's comments on Japan auto tariffs; Subaru, tyremakers shine

TOKYO, Aug 27 (Reuters) - Japanese shares made a modest rebound on Tuesday after the previous session’s sharp selloff, as investors registered relief after President Donald Trump said the United States had no plan to imminently impose new tariffs on autos imported from Japan.

The Nikkei share average advanced 1.0% to 20,456.08, with Subaru and tyremakers leading the gains. On Monday, the benchmark lost 2.2% to hit the lowest closing level since January 11.

Asked if he was still considering the U.S. tariffs on Japanese cars, President Trump told a news conference late on Monday that his administration is not looking at that although it’s something he could do at a later date if he wanted to.

This boosted prices of Tokyo-listed carmakers, tyremakers and car parts makers.

Subaru Co, which has the biggest revenue exposure to the United States among Japanese carmakers, jumped 4.9%, and the transport equipment sector gained 1.2%.

Bridgestone gained 1.3%, while Yokohama Rubber and Sumitomo Rubber climbed 3.0% and 2.3%, respectively, with the rubber products sector added 1.5% to become the best performing sector among the Topix’s 33 sub-indexes.

Auto part makers Aisin Seiki and Koito Manufacturing rose 1.2% and 1.7%, respectively.

The broader Topix added 0.8% to 1,489.69, with 31 of Tokyo’s 33 subindexes gaining.

Other notable movers included Akebono Brake, which soared 10.7% after the troubled automotive supplier announced the resignation of its chief executive and appointed a new CEO.

On Wall Street, all three major stock indexes bounced back on Monday after President Trump predicted a trade deal with China, but fell short of reclaiming all of its losses on Friday.

“The market has priced in much of the bad news about the U.S.-China trade war already. I think there is more upside risk than downside here,” said Keita Kubota, deputy head of Japan equities at Aberdeen Standard Investments. (Reporting by Tomo Uetake; Editing by Simon Cameron-Moore)

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