Japan Stocks Climb for First Time in Five Days After Selloff

Japanese stocks rose for the first time in five days on speculation a selloff that drove valuations to a 28-month low was excessive even as the country battles to prevent a nuclear disaster after its strongest earthquake.

Toyota Motor Corp., the world’s largest carmaker, surged 7 percent. Sony Corp., Japan’s biggest exporter of consumer electronics, jumped 7.4 percent. Mizuho Financial Group Inc., Japan’s third-biggest bank, surged 5.4 percent. Tokyo Electric Power Co., Asia’s biggest power generator, was set to tumble by the daily limit after the company said today a new fire broke out at a reactor following an earthquake on March 11.

The Nikkei 225 (NKY) Stock Average rose 4.5 percent to 8,988.45 as of 12:41 p.m. in Tokyo, set for the biggest gain since May 2009. The gauge plunged 11 percent yesterday as record trading volume on the main section of the Tokyo Stock Exchange drove the average price of shares in the Nikkei to 14.7 times estimated profit, the lowest level since November 2008.

“People sold anything and everything in a panic and now they’re buying back stocks which declined a lot,” said Kiyoshi Ishigane, a senior strategist in Tokyo at Mitsubishi UFJ Asset Management Co., which oversees $84 billion. “If we see the nuclear issues being overcome, or if we see a possibility that radiation leaks can be controlled, shares should rise even further. The global economy is not so bad, so if reconstruction in Japan advances, stocks should recover slowly. It will take time to factor in the bad news.”