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Nikkei closes at 7-year high again

FXStreet (Barcelona) - The Nikkei 225 index continued to rise today, clocking a fresh seven-year closing high for the third straight session, on speculation that Prime Minister Shinzo Abe won’t raise the consumption tax.

The index closed 195 points or 1.14% higher at 17,392.79 levels, its strongest closing since Oct. 11, 2007. Moreover, the Nikkei accelerated its gains in the afternoon session. The Yen’s renewed fall against the US Dollar also sparked buying interest in the equities.

The index heavyweights like mobile phone carrier SoftBank, robot maker Fanuc and clothing retailer Fast Retailing gained sharply. Due to the weakness in the Yen, Automakers Toyota and Honda, and tech giants Hitachi and Panasonic saw fresh buying interest. On the other hand, realtor Mitsui Fudosan, non bank lender Aiful and construction machinery maker Komatsu declined.

The Japanese investors are getting increasingly confident that Abe will decide to push back the consumption tax hike and dissolve the Lower House for a snap election. However, investors shall also eye Japan’s preliminary gross domestic product data for July-September, due out Monday.

Nikkei Technical Levels

The index has an immediate resistance at 17,441 levels, above which the prices can rise to 17,488 levels. On the flip side, support is seen at 17,197 and 17,108 levels.

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