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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Soft yen boosts Nikkei to six year high

Article By: ,  Financial Analyst
December 20, 2013 9:15 AM

The Nikkei rose to a new six-year closing high today (December 20th), boosted by a soft yen.

After the US Federal Reserve's decision to start cutting back its quantitative easing programme was confirmed earlier in the week, the Nikkei rose by 1.7 per cent yesterday and followed that up with a 0.1 per cent increase today to end the session at 15,870.42.

The session had been a choppy one, but the Nikkei ended up for the day and higher for the week overall, but in contrast the Topix was 0.1 per cent lower at the end of the session.

"The Japanese market has risen nearly 600 points between Tuesday and Thursday. But profit-taking was limited during the day today, so investors assumed the Nikkei is still on the rising trend," a trader at a European brokerage told Reuters.

Following today's 0.1 per cent increase, the Nikkei had reached its highest closing level since December 2007, indicating that the market is fully recovered from the global financial crash and its after-effects.

Up for the week

The Nikkei was therefore three per cent higher at the end of the week, with the market supported by an announcement from the Bank of Japan that it will keep monetary policy steady.

With the Nikkei now heading into a long weekend, the stock market has ended on a high and traders will be confident the festive season can be a good one for the index.

It was not just the Nikkei that got a boost from the news the US Federal Reserve has started to wind down its monetary policy, as the Australian ASX was two per cent up yesterday, while South Korea and Indonesia's main stock markets were up as well.

Scott Clemons, chief investment strategist for Brown Brothers Harriman Wealth Management, told BBC News that the Fed appears in no rush to remove the stimulus package entirely.

"The Fed is using a very careful language that they are going to continue to support the economy. That's part of the reason why the stock market is rallying," he said.

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