Tokyo stocks higher in morning as dip-buying offsets chip losses

TOKYO (Kyodo) -- Tokyo stocks were higher Thursday morning, as buying on dips after the market's three-day losing streak erased earlier losses from semiconductor-related shares that tracked their U.S. counterparts overnight.

The 225-issue Nikkei Stock Average rose 129.07 points, or 0.34 percent, from Wednesday to 38,090.87. The broader Topix index was up 19.43 points, or 0.73 percent, at 2,682.58.

The U.S. dollar was capped in the lower 154 yen zone in Tokyo amid wariness that Japanese authorities may conduct a yen-buying intervention, after finance ministers of the United States, Japan and South Korea agreed Wednesday to consult closely on foreign exchange market developments.

At noon, the U.S. dollar fetched 154.12-15 yen compared with 154.35-45 yen in New York and 154.61-63 yen in Tokyo at 5 p.m. Wednesday.

The euro was quoted at $1.0678-0679 and 164.57-62 yen against $1.0668-0678 and 164.72-82 yen in New York, and $1.0625-0626 and 164.28-32 yen in Tokyo late Wednesday afternoon.

The Nikkei index was initially dragged down by heavyweight chip-related companies which tracked losses by their U.S. counterparts overnight, following weaker-than-expected earnings from Dutch semiconductor equipment maker ASML Holding N.V.

But the market later trimmed losses as dip-buying kicked in after the benchmark index fell over 1,500 points in the past three trading days, with a fall in U.S. and Japanese long-term interest rates also "contributing to the Nikkei's resistance to further declines," said Maki Sawada, a strategist in the Investment Content Department of Nomura Securities Co.

Lower interest rates increase the attractiveness of growth stocks like technology issues, as they reduce borrowing costs for firms.