Tokyo surges, extending global rally

Tokyo stocks surged at the start of trading Wednesday, extending a rally on global financial markets, while Sony jumped more than five percent after investors shrugged off a weak profit forecast.

The consumer electronics giant said Tuesday it would book net profit of 80 billion yen ($726 million) this fiscal year, down nearly 46 percent from the previous year when it booked a one-time gain from the sale of Olympus shares.

But on Wednesday investors focused on Sony's long-term prospects in image sensors and entertainment over the lowered profit forecast, sending the company's shares 5.31 percent higher to 3,039 yen in early deals.

On currency markets, the dollar advanced against the yen amid mounting expectations of an interest rate rise by the Federal Reserve in the next couple of months.

"We could see a rate hike in either June or July," Chihiro Ohta, senior strategist at SMBC Nikko Securities, told Bloomberg News.

"The US increasing borrowing costs will also be positive for Japanese stocks through a stronger dollar."

The greenback climbed to 110.06 yen from 109.99 yen in New York and 109.22 yen in Tokyo earlier on Tuesday.

Japanese exporters were lifted by the weaker currency, which is a plus for their profitability.

The benchmark Nikkei 225 index at the Tokyo Stock Exchange soared 1.61 percent, or 265.59 points, to 16,764.35 in opening deals, rebounding after finishing two straight sessions in the red.

The broader Topix index of all first section shares rose 1.43 percent, or 18.93 points, to 1,345.43.

Toyota shares climbed 1.86 percent to 5,530 yen in early trading following overnight news of a partnership with ridesharing titan Uber.

Toyota and Uber said they had entered into a memorandum of understanding to explore collaboration, starting with trials in countries where ridesharing is expanding.

Other automakers also jumped, lifted by a weaker yen, with Nissan tacking on 1.91 percent to 1,063 yen and Honda 1.96 percent higher at 2,979 yen.

On Tuesday, US equities ended solidly in positive territory, with technology and financial shares benefitting especially from greater confidence in the US economic outlook.

On Wall Street, the Dow closed 1.2 percent higher, the S&P 500 advanced 1.4 percent and the tech-rich Nasdaq soared 2.00 percent.

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