Japan's Nikkei 225 rises 1.09% as investors await US jobs report
What’s happening:-
Japan’s stocks hit record highs this morning, after Prime Minister Shigeru Ishiba announced his resignation.
What happened:-
Japan’s benchmark Nikkei 225 rose for the second straight session, with tech stocks leading the gains.
The Japanese yen also moved higher against the US dollar this morning.
Japan's Nikkei 225 rises
Why it matters:-
Japan’s Prime Minister announced plans to resign on Sunday, following rising disagreements within the ruling party and pressure following his defeat in the national elections last year.
Japan finalised a bilateral trade agreement with the US last week to cut auto tariffs on Japanese vehicles from 27.5% to 15%. US-made vehicles will be allowed to enter Japan without further testing.
Japan’s tariff negotiator Ryosei Akazawa said that US tariffs on Japanese goods, including vehicles and auto parts, are scheduled to be lowered by September 16.
Japan's Nikkei 225 index rises
Meanwhile, data released on Monday showed that Japan’s service sector index surged to 46.7 in August, from 45.2 in July. The latest figure marks the highest level since January.
Japan’s economy expanded by 2.2% year-over-year in the second quarter, topping the initial reading of 1.0%. This represents a significant acceleration from the 0.3% growth reported in the previous quarter. With this, Japan recorded annual growth for the fifth straight quarter.
Data also showed that Japan’s current account surplus had shrunk to ¥2,684.3 billion in July, from ¥3,319.7 billion in the year-ago period.
Tech stocks were among the top performers this morning, with shares of Advantest, Tokyo Electron and Disco recording gains. The financial, industrial, and consumer sectors also lent support to the market.
Japan’s Nikkei 225 index rose 0.9% to breach the 44,000 resistance level this morning, while the broader Topix index rose 0.4% to 3,150, with both indices hitting new record highs.
What to watch:-
Investors await the announcement of Japan’s next Prime Minister and there are hopes of the new premier introducing several fiscal stimulus measures to provide a boost to the economy.
Japan's Nikkei 225 leads Asian stocks higher in final trading session of the week
Data on Reuters Tankan Index (0300 UAE Time), PPI (0350 UAE Time) and BSI Large Manufacturing (0350 UAE Time) will be released on Thursday. The Reuters Tankan index for Japanese manufacturers, which rose to +9 in August, is expected to climb further to 10 in September. Producer prices in Japan, which rose 2.6% year-over-year in July following 2.9% in the previous month, are expected to surge by 2.7% in August.