Japan's Nikkei rises as traders brush off Trump's Iran threat, focus on potential deal
By Junko Fujita
TOKYO, April 6 (Reuters) - Japan's Nikkei share average ended higher on Monday as investors largely shrugged off U.S. President Donald Trump's latest threat to attack Iranian infrastructure, and instead focused on signs the Middle East conflict could de-escalate.
The Nikkei .N225 rose 0.55% to 53,413.68, while the broader Topix .TOPX erased early gains to close 0.01% lower at 3,644.8.
On Sunday, Trump warned that the U.S. could target Iran's power plants and bridges as early as Tuesday if the strategic Strait of Hormuz is not reopened.
Trump's repeated threats to destroy civilian infrastructure have put global traders on edge for reciprocal attacks by Iran on targets in the Gulf states.
However, he also suggested a diplomatic breakthrough may be imminent, saying a deal with Iran could be reached as soon as Monday and that negotiations with Iran were already underway, according to a Fox News report.
"Trump has become like the boy who cried wolf," said Takamasa Ikeda, senior portfolio manager at GCI Asset Management.
"If he were really willing to attack Iran's facilities, he would have done it already. The market started eyeing the withdrawal of the U.S., and the start of the post-war negotiations between allied nations without the U.S."
The Nikkei rallied for a third consecutive session, but investors started selling stocks once the benchmark hit the psychologically important level of 54,000, said Kazuaki Shimada, chief strategist at IwaiCosmo Securities.
"The Nikkei has more resistance to the rise in oil prices, as the market started shifting its focus to growth in the artificial intelligence-related stocks," said Shimada.
Chip-testing equipment maker Advantest 6857.T rose 1.74% and technology investor SoftBank Group 9984.T gained 1.08%.
The shipping sector .ISHIP.T rose 1.55% to become the top performer among the Tokyo Stock Exchange's 33 industry sub-indexes.
Of the more than 1,600 stocks trading on the TSE's prime market, 60% rose and 35% fell, with 4% trading flat.
