Japanese stocks end higher on bargain hunting; after weekly gains

TOKYO, May 20 (Reuters)Japanese stocks closed higher on Friday, rebounding from a nearly 2% drop in the previous session, as investors clawed back battered stocks on hopes of corporate earnings growth.

Nikkei stock average .N225 ended up 1.27% at 26,739.03 and marked a weekly gain of 1.18%. The expanded Topix .TOPX climbed 0.93% to 1,877.37 and was up 0.71% for the week.

The gains came even as Wall Street closed lower overnight, hurt by fears over the widening impact of inflation and a drop in Cisco Systems. CSCO.O because of its bleak outlook.

“Japanese stocks were firm today (Friday) even as the Dow Jones and S&P extended their losses,” said Shigetoshi Kamada, managing director of the research department at Tachibana Securities.

“Overall, the outlook for companies is relatively strong and many have made modest forecasts for currencies, which means there could be further upside towards the end of the year.”

Fast Retailing, owner of Uniqlo 9983.T rose 2.53% and provided the biggest boost to the Nikkei. SoftBank Group 9984.T followed suit with its 3.5% rise, while chip-making equipment maker Tokyo Electron 8035.T added 1.27%.

Seiko Epson 6724.T jumped 8.78% and was the Nikkei’s top gainer after the watchmaker announced a buyback of up to 9.35% of its shares.

Tokyo Gas 9531.T fell 2.75% and was the index’s biggest loser after a report said the gas supplier would pick up the cost hike because there was a limit to how much it could pass on on consumers.

Recruitment Agency Recruit Holdings 6098.T rose 6.3% and was the top gainer among the top 30 Topix names, followed by lens maker Hoya 7741.Twhich jumped 5.32%.

Touch screen manufacturer Keyence 6861.T fell 2.39% and was the worst performer in the top 30, followed by air conditioning manufacturer Daikin Industries Ltd 6367.Twhich fell 1.28%.

(Reporting by Junko Fujita; Editing by Aditya Soni and Uttaresh.V)

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