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Nikkei surpasses 33,000 on U.S. Fed policy speculation

EditorRachael Rajan
Published 11/16/2023, 05:00 AM
© Reuters.
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Japan's stock market witnessed a significant rally today as the Nikkei share average soared past the 33,000 threshold for the first time in nearly two months. The surge was fueled by strong corporate earnings and market speculation that the US Federal Reserve may adopt a more dovish stance in the future. The Nikkei closed with an impressive 2.52% gain, while 159 of its 225 listed companies saw their stock prices rise.

The broader Topix index also experienced growth, adding 1.19% by the end of the trading day. This bullish sentiment was mirrored in Wall Street's performance, where major indexes enjoyed robust gains overnight. Notably, the Nasdaq index rallied by 2.13%, buoyed by softer US consumer inflation data which has led to speculation about potential shifts in Fed policy.

Investors in Japan focused their attention on firms with positive earnings reports. One such company was Idemitsu Kosan, an oil and coal producer that led the charge with an 18.29% jump in its stock price following an upward revision of its profit forecast and a share split announcement. This news propelled oil and coal producers to become the top performers on the Tokyo Stock Exchange (TSE), collectively advancing by 6.42%.

Semiconductor-related shares also outperformed other sectors. Advantest and Tokyo Electron benefited from a 3.62% surge in the Philadelphia SE semiconductor index. Major conglomerates like SoftBank (TYO:9984) Group and Sony (NYSE:SONY) were not left behind, each gaining around 5%.

On the flip side, financial stocks did not fare as well, particularly insurers and banks within the TSE, which were negatively impacted by lower yields in both US and domestic markets. Kazuo Kamitani from Nomura Securities underscored the significance of these market movements, indicating a heightened focus on Japan's corporate sector amid global economic developments.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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