Japanese stocks rise to new 7-year high

Japanese stocks rose to a seven-year high Monday, lifted by stronger-than-expected machinery orders. The Nikkei 225 index climbed 121.04 points, or 0.67 percent, on the Tokyo Stock Exchange, to 18,261.98 points, the index's highest close since May 2, 2000.

Investors were heartened by figures released earlier Monday that the country's core machinery orders rose a second straight month in May, helped by strong growth in orders for electrical machinery.

Seasonally adjusted core machinery orders surged 5.9 percent in May compared to April, the data's biggest gain since June 2006. Core orders exclude those from electric power firms and those for ships, which are often a source of volatility in the overall data due to their large sizes. Economists had forecast a 2.6 percent gain.

Machinery orders are widely regarded as a leading indicator of corporate capital investment, which accounts for about 15 percent of Japan's gross domestic product.

"The machinery orders data was very strong today and that has helped a lot of the precision equipment makers," said Akio Yoshino, market economist at Societe Generale Asset Management.

Gainers included Nikon Corp., which climbed 3.66 percent to 3,680 yen ($29.68) and construction equipment maker Komatsu Ltd., which added 1.88 percent to 3,800 yen ($30.65) and heavy machinery maker Mitsubishi Heavy Industries Ltd., which rose 1.02 percent to 790 yen ($6.37).

Oil companies rose as oil futures closed at a 10-month high in U.S. trading Friday. Showa Shell Sekiyu K.K. rose 2.26 percent to 1,536 yen ($12.39).

The broader Topix index, which includes all shares on the exchange's first section, added 12.56 points, or 0.71 percent, to 1,792.23 points. The Topix slipped 0.47 percent on Friday.

In currencies, the U.S. dollar was trading at 123.62 yen at 2:50 p.m. Monday, up from 123.39 yen late Friday in New York. The euro fell to $1.3620 from $1.3623.