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Nikkei gains most since 2016 on hopes for BOJ buying; SoftBank Group jumps
FILE - In this Friday, March 13, 2020, file photo, a trader walks on the floor of the New York Stock Exchange during President Donald Trump's televised speech from the White House, in New York. Stock markets are set for another week of turbulent trading as U.S. index futures fell sharply after the Federal Reserve slashed interest rates and more companies and governments took action over the weekend to shut down European and American society. (AP Photo/Mark Lennihan, File)

Nikkei gains most since 2016 on hopes for BOJ buying; SoftBank Group jumps

SYDNEY: Japan’s share benchmark Nikkei climbed more than 7% on Tuesday, logging its biggest one-day surge in more than four years, boosted by hopes for massive buying by the Bank of Japan (BOJ) and public pension funds.

The Nikkei average surged 7.1%, its biggest daily gain since February 2016, to finish at 18,092.35, its highest close in 1-1/2 weeks.

The Nikkei’s volatility index, a measure of investors’ volatility expectations based on option pricing and considered to be a fear gauge, slid 14.3% to 46.69, further off a nine-year peak of 60.86 hit a week ago.

U.S S&P 500 stock futures last traded 3.1% higher and MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 4.3% as the Federal Reserve’s promise of bottomless dollar funding eased strains in financial markets hammered by the coronavirus pandemic.

In addition to the Fed’s unlimited QE, hopes for massive stock buying by the BOJ, public pension funds and buyback by listed companies supported the Tokyo market, analysts said.

Some think the fact that the BOJ has been buying a considerable amount of Exchanged Traded Funds in a more random manner than before makes speculative players hesitant to short Japanese stocks.