Japanese Nikkei Rises on American Stocks, Heavyweight Chip Stocks
On June 11, 2024, at 05:20 AM, the Japanese Nikkei stock average rose on Tuesday morning as investors cheered record highs on Wall Street, leading to a surge in heavyweight domestic semiconductor stocks. The Nikkei was up 0.3% at 39,155.16 during the midday break, reaching a three-week high of 39,336.66 earlier in the session. The broader Topix also increased by 0.21% to 2,788.27.
Despite a volatile session on Wall Street last night, both the S&P 500 and Nasdaq hit record highs at the close, boosting sentiment during trading in Tokyo. Particularly, Japan’s heavyweight technology stocks performed strongly, with a 1.4% increase on the Philadelphia SE Semiconductor Index. However, the domestic benchmark lost some gains in the second half of the session as investors turned cautious ahead of the US CPI report for May, scheduled for Wednesday along with the conclusion of the Federal Reserve’s two-day policy meeting.
The markets remain confident that the next move by the central bank will be a cut rather than another hike, which is supporting US and Japanese stocks, according to Charu Chanana, global market strategist and head of FX strategy at Saxo. A weak yen continues to support Japanese stocks, while political unrest in Europe may lead to more inflows from long-term investors.
The dollar was last trading around 157.21 yen. Meanwhile, the Bank of Japan is expected to keep short-term interest rates within a range of 0-0.1% during its meeting later this week, although policymakers are considering ways to slow down bond purchases.
Among individual stocks on Tuesday, chip equipment giant Tokyo Electron rose by 2.2%, while chip testing equipment maker Advantest increased by 0.9%. Medical equipment manufacturer Terumo climbed 1.1%, and Chugai Pharmaceutical surged by 2.6%. On the other hand, pharmaceutical company Eisai declined by approximately 3%.
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© Reuters – 2024