Tokyo stocks rebounded Tuesday on buybacks after heavy losses the previous day but gains were limited as investors remain jittery ahead of upcoming earnings reports by major U.S. corporations and financial institutions.
The 225-issue Nikkei Stock Average gained 73.07. points, or 0.57 percent, from Monday to 12,990.58. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was up 9.73 points, or 0.78 percent, to 1,255.97.
Gains were led by iron and steel, oil and coal product, and real estate issues, while decliners included paper and pulp as well as sea transport issues.
Tokyo stocks moved narrowly between positive and negative territory in early trading before making wider gains toward the end of the morning session, recovering the 13,000 level for the first time since last Friday.
But they failed to sustain the momentum and erased some of their earlier gains as investors, unnerved by fears about fresh credit woes, refrained from active buying ahead of U.S. earnings reports starting later Tuesday, brokers said.
''Now is like a turning point for the market as it tries to see if there is leeway for a full rebound or for testing the low point,'' said Masatoshi Sato, a senior strategist at Mizuho Investors Securities Co.
Investors in the Tokyo stock market are closely watching the results of U.S. earnings reports for the first quarter of 2008 as Japan is greatly influenced by the U.S. business and economic climate.
Major U.S. commercial bank Wachovia Corp. said Monday it suffered red ink in the first quarter due to subprime loan-related write-downs.
Tsuyoshi Segawa, equity strategist of the equity information department at Shinko Securities Co., said the unexpectedly poor figures of Wachovia underlined the fallout of the U.S. subprime loan problems and reignited fears of possibly more subprime-linked losses.