Market Update
Japan
Akira Ito
23 Dec, 2025
Tokyo
Japan's stock market indexes advanced for the third consecutive session in the early morning but hovered near the flatline, and bond yields pulled back.
The Nikkei 225 Stock Average and the broader Topix struggled to hold onto morning gains in the final hours of the trading session.
The yield on 10-year Japanese government bonds edged lower for the second consecutive session after reaching a high of 2.1%.
Investors prepared for higher yields after the Bank of Japan lifted its benchmark rate by 25 basis points to 0.75%, a three-decade high.
The bond yields pushed higher as the Prime Minister Sanae Takaichi's administration prepares to increase government spending in the next fiscal year starting in April.
Japan's government spending in the upcoming fiscal year is likely to exceed last year's budget of 122 trillion yen, or $780 billion, and bond offerings are likely to surpass 28.6 trillion yen, or $184 billion.
The yen hovered near 156.04 against the U.S. dollar despite the Bank of Japan revising its benchmark rates higher last Friday.
Japan Indexes and Stocks
The Nikkei 225 Stock Average decreased 0.1% to 50,304.99, and the broader Topix inched higher 0.2% to 3,414.16.
Softbank Group decreased 0.7% to ¥17,685. 0, Tokyo Electron fell 0.5% to ¥33,000. 0. Advantest Corp. declined 1.9% to ¥19,680.0.
China Indexes Extended 2025 Gains, Six IPOs Scaled Advanced In Trading
Li Chen
23 Dec, 2025
Hong Kong
Investors bid up stocks in hopes that market indexes will continue to advance in the new year.
The Hang Seng Index advanced 0.3%, and the mainland-focused CSI 300 Index edged up 0.3% in thin trading volume dominated by technology stocks and new issues.
Optimism ruled for the second consecutive week amid improving market sentiment and hopes of higher earnings growth in the next year.
Despite the market optimism, the broader economy is facing slowing export momentum, persistent residential market weakness, and elevated jobless rates.
Moreover, retail sales, when adjusted for inflation, are struggling to advance as consumers retrench to basics amid rising economic uncertainties.
China's GDP growth in 2026 is likely to slow to closer to 4%, as more businesses shift production to overseas locations and government spending growth stabilizes.
China Indexes and Stocks
The Hang Seng Index added 0.3% to 25,878.73, and the mainland-focused CSI 300 index edged up 0.3% to 4,635.13.
Three mainland-China-based companies began trading on the Hong Kong Stock Exchange, following four new issues on Monday.
QingSong Health jumped 136% to HK $54.90, and the company priced its initial public offering at HK $22.68 per share.
The digital healthcare and insurance services-related platform operator raised HK$601.9 million in gross proceeds through the sale of 26.5 million shares.
Nuobikan Artificial Intelligence Technology Chengdu soared more than 340% to HK $351, and the technology company priced its initial public offering at HK $80.0 per share.
The railway and power grid industry-focused company raised HK $302.9 million through the sale of 3.8 million shares.
HanX Biopharmaceuticals dropped more than 40% to HK $18.26, and the company priced its initial public offering at HK $32.0 per share.
The oncology therapeutics-focused company raised HK $586.3 million through the sale of 18.3 million shares.
On the mainland, Jiangsu Xihua New Energy Technology soared 150% to 24.91 yuan in Shanghai, RNBC New Energy jumped 210% to 71.20 yuan and Shenzhen Tiansu Calibration & Testing gained 115% to 79.37 yuan in Shenzhen.
China Vanke declined 2% to HK $3.47 after creditors agreed to extend its bond interest payment until the end of January but rejected the proposal to extend principal payment.
China Indexes Extended 2025 Gains, Six IPOs Scaled Advanced In Trading
Li Chen
23 Dec, 2025
Hong Kong
Investors bid up stocks in hopes that market indexes will continue to advance in the new year.
The Hang Seng Index advanced 0.3%, and the mainland-focused CSI 300 Index edged up 0.3% in thin trading volume dominated by technology stocks and new issues.
Optimism ruled for the second consecutive week amid improving market sentiment and hopes of higher earnings growth in the next year.
Despite the market optimism, the broader economy is facing slowing export momentum, persistent residential market weakness, and elevated jobless rates.
Moreover, retail sales, when adjusted for inflation, are struggling to advance as consumers retrench to basics amid rising economic uncertainties.
China's GDP growth in 2026 is likely to slow to closer to 4%, as more businesses shift production to overseas locations and government spending growth stabilizes.
China Indexes and Stocks
The Hang Seng Index added 0.3% to 25,878.73, and the mainland-focused CSI 300 index edged up 0.3% to 4,635.13.
Three mainland-China-based companies began trading on the Hong Kong Stock Exchange, following four new issues on Monday.
QingSong Health jumped 136% to HK $54.90, and the company priced its initial public offering at HK $22.68 per share.
The digital healthcare and insurance services-related platform operator raised HK$601.9 million in gross proceeds through the sale of 26.5 million shares.
Nuobikan Artificial Intelligence Technology Chengdu soared more than 340% to HK $351, and the technology company priced its initial public offering at HK $80.0 per share.
The railway and power grid industry-focused company raised HK $302.9 million through the sale of 3.8 million shares.
HanX Biopharmaceuticals dropped more than 40% to HK $18.26, and the company priced its initial public offering at HK $32.0 per share.
The oncology therapeutics-focused company raised HK $586.3 million through the sale of 18.3 million shares.
On the mainland, Jiangsu Xihua New Energy Technology soared 150% to 24.91 yuan in Shanghai, RNBC New Energy jumped 210% to 71.20 yuan and Shenzhen Tiansu Calibration & Testing gained 115% to 79.37 yuan in Shenzhen.
China Vanke declined 2% to HK $3.47 after creditors agreed to extend its bond interest payment until the end of January but rejected the proposal to extend principal payment.
AI Stocks and Gold and Silver Power Ahead as Year's End Approaches
Barry Adams
22 Dec, 2025
New York City
U.S. stocks edged higher at the start of the holiday-shortened week as artificial intelligence-linked stocks rebounded last week.
The S&P 500 index edged up 0.1%, the Nasdaq Composite increased 0.2%, and gold and silver inched further into record territory.
Investors are hoping that the so-called Magnificent 7 will retain leadership as the year-end approaches and relatively cheaper sectors of the market remain in favor.
On the economic front, the uneven U.S. hirings in October and November confirmed the ongoing pattern over the last seven months, as businesses of all sizes struggle with macroeconomic uncertainty.
The U.S. economy added 64,000 net new jobs in November, and payrolls shrank by 105,000 in October, the U.S. Bureau of Labor Statistics said on Tuesday.
However, skeptical investors questioned the reliability of the jobs data amid low survey participation, and economists signaled sharp downward revisions in the near future.
The payroll data, when viewed in a broader context, reveals a significantly weaker job market than the monthly data indicates.
The so-called K-shaped economy has also put investors on alert amid a brewing affordability crisis as goods prices continue to rise and wages lag overall inflation.
Global markets are likely to lack direction as investors prepare for the year-end and the U.S. federal government closes for extra Christmas holidays between December 24 and 26.
Despite the stock market indexes hovering near record highs, gold and silver rebounded after two weeks of sideways trading.
The governments of the U.S., UK, France, Germany, Japan, and China have accumulated outsized debts, and the debt levels are expected to continue to rise in 2026.
Moreover, central banks of China and Japan and a select few European Union nations are actively lowering their U.S. Treasury holdings and increasing exposure to gold.
This week investors are awaiting the release of delayed economic reports on durable goods orders, industrial output, and the second estimate of the third-quarter GDP.
The New York Stock Exchange will close early at 1:00 p.m. ET on Christmas Eve, while market operations will be suspended Thursday for Christmas Day and reopen regular trading hours on Monday, December 29.
AI Stocks and Gold and Silver Power Ahead as Year's End Approaches
Barry Adams
22 Dec, 2025
New York City
U.S. stocks edged higher at the start of the holiday-shortened week as artificial intelligence-linked stocks rebounded last week.
The S&P 500 index edged up 0.1%, the Nasdaq Composite increased 0.2%, and gold and silver inched further into record territory.
Investors are hoping that the so-called Magnificent 7 will retain leadership as the year-end approaches and relatively cheaper sectors of the market remain in favor.
On the economic front, the uneven U.S. hirings in October and November confirmed the ongoing pattern over the last seven months, as businesses of all sizes struggle with macroeconomic uncertainty.
The U.S. economy added 64,000 net new jobs in November, and payrolls shrank by 105,000 in October, the U.S. Bureau of Labor Statistics said on Tuesday.
However, skeptical investors questioned the reliability of the jobs data amid low survey participation, and economists signaled sharp downward revisions in the near future.
The payroll data, when viewed in a broader context, reveals a significantly weaker job market than the monthly data indicates.
The so-called K-shaped economy has also put investors on alert amid a brewing affordability crisis as goods prices continue to rise and wages lag overall inflation.
Global markets are likely to lack direction as investors prepare for the year-end and the U.S. federal government closes for extra Christmas holidays between December 24 and 26.
Despite the stock market indexes hovering near record highs, gold and silver rebounded after two weeks of sideways trading.
The governments of the U.S., UK, France, Germany, Japan, and China have accumulated outsized debts, and the debt levels are expected to continue to rise in 2026.
Moreover, central banks of China and Japan and a select few European Union nations are actively lowering their U.S. Treasury holdings and increasing exposure to gold.
This week investors are awaiting the release of delayed economic reports on durable goods orders, industrial output, and the second estimate of the third-quarter GDP.
The New York Stock Exchange will close early at 1:00 p.m. ET on Christmas Eve, while market operations will be suspended Thursday for Christmas Day and reopen regular trading hours on Monday, December 29.
Japan's Nikkei 225 Soared 2% Tracking Friday's Wall Street Gains
Akira Ito
22 Dec, 2025
Tokyo
Stocks in Japan advanced on Monday, tracking gains from Friday's trading on Wall Street.
The Nikkei 225 Stock Average advanced 1.9%, the broader Topix increased 0.7%, and the yen traded at 157.24 against the U.S. dollar.
Japan's stock market indexes advanced following the easing of worries about the AI boom slowing down.
On the economic front, this week investors are awaiting Tokyo's inflation, minutes from the Bank of Japan's October policy meeting, and Japan's industrial production, retail sales, and jobless rate.
Global markets are likely to lack direction as investors prepare for the year-end and the U.S. federal government closes for extra Christmas holidays between December 24 and 26.
Japan Indexes and Stocks
The Nikkei 225 Stock Average rose 1.9% to 50,459.74, and the broader Topix rose 0.7% to 3,408.30.
Tokyo Electron rose 6.3% to ¥33,150.0, Advantest Corp. advanced 4% to ¥20,005.0, and Lasertec advanced 6% to ¥30,110.0.
Toyota Motor Corp. advanced 0.8% to ¥3,450.0, Honda Motor gained 1.8% to ¥1,585.50, and Nissan Motor Co. Ltd. increased ¥401.10.
Japan's Nikkei 225 Soared 2% Tracking Friday's Wall Street Gains
Akira Ito
22 Dec, 2025
Tokyo
Stocks in Japan advanced on Monday, tracking gains from Friday's trading on Wall Street.
The Nikkei 225 Stock Average advanced 1.9%, the broader Topix increased 0.7%, and the yen traded at 157.24 against the U.S. dollar.
Japan's stock market indexes advanced following the easing of worries about the AI boom slowing down.
On the economic front, this week investors are awaiting Tokyo's inflation, minutes from the Bank of Japan's October policy meeting, and Japan's industrial production, retail sales, and jobless rate.
Global markets are likely to lack direction as investors prepare for the year-end and the U.S. federal government closes for extra Christmas holidays between December 24 and 26.
Japan Indexes and Stocks
The Nikkei 225 Stock Average rose 1.9% to 50,459.74, and the broader Topix rose 0.7% to 3,408.30.
Tokyo Electron rose 6.3% to ¥33,150.0, Advantest Corp. advanced 4% to ¥20,005.0, and Lasertec advanced 6% to ¥30,110.0.
Toyota Motor Corp. advanced 0.8% to ¥3,450.0, Honda Motor gained 1.8% to ¥1,585.50, and Nissan Motor Co. Ltd. increased ¥401.10.
China Indexes Advanced Ahead of Holiday Break, Four New Listings Plunged
Li Chen
22 Dec, 2025
Hong Kong
Stocks advanced on Monday in China and Hong Kong at the start of the holiday-shortened week.
The Hang Seng Index increased 0.3%, and the mainland-focused CSI 300 index advanced 0.8% as investors adjusted positions as the year-end approached.
The Hong Kong Stock Exchange will close early on December 24, while market operations will be suspended on December 25 and 26 and reopen regular trading hours on December 29.
The Stock Connect, the electronic link that facilitates traders in mainland China to purchase stocks in Hong Kong, will also halt its trading in the early afternoon on December 24 and reopen on December 29.
Optimism prevailed in Monday's trading as investors held out for a strong finish in 2025, driven by expectations of higher earnings.
Across Asia, benchmark indexes advanced nearly 2% in Tokyo and Seoul, edged higher 1% in Sydney, and gained a fraction in Taiwan and Malaysia.
China Stocks and Movers
The Hang Seng Index increased 0.3% to 25,768.64, and the mainland-focused CSI 300 index added 0.8% to 4,604.43.
E-commerce and AI-linked stocks dominated market gainers on Monday.
Alibaba Group advanced 1.1%, Tencent Holdings edged up 0.1%, Baidu Inc. jumped 2%, and Meituan inched higher 0.2%.
On the downside, ZTO Express, Xiaomi, and NetEase declined between 1% and 2%.
Four new companies listed on the Hong Kong Stock Exchange on Monday, as companies raced to complete initial public offerings ahead of the year's end.
BenQ BM Holding dropped nearly 40% to HK $5.75, and the general hospital group priced its initial public offering at HK $9.34 per share.
The company raised HK$625.8 million in gross proceeds through the sale of 67 million shares.
B&K Corporation Ltd. dropped 7% to HK $35.40, and the biopharma company priced its offering at HK $38.20 per share.
The protein therapy-focused company raised gross proceeds of HK $674.2 million through the sale of 17.6 million shares.
Impression Dahongpao plunged more than 25% to HK $2.70, and the cultural tourism-focused company priced its initial offering at HK $3.60 per share.
The cultural tourism services provider and hotel management company raised gross proceeds of HK $129.96 million through the sale of 36.1 million shares.
Nanhua Futures decreased 19% to HK $9.50, and the company priced its initial public offering at HK $12.0 per share.
The futures brokerage company raised gross proceeds of HK $1.3 billion through the sale of 107.6 million shares.
China Indexes Advanced Ahead of Holiday Break, Four New Listings Plunged
Li Chen
22 Dec, 2025
Hong Kong
Stocks advanced on Monday in China and Hong Kong at the start of the holiday-shortened week.
The Hang Seng Index increased 0.3%, and the mainland-focused CSI 300 index advanced 0.8% as investors adjusted positions as the year-end approached.
The Hong Kong Stock Exchange will close early on December 24, while market operations will be suspended on December 25 and 26 and reopen regular trading hours on December 29.
The Stock Connect, the electronic link that facilitates traders in mainland China to purchase stocks in Hong Kong, will also halt its trading in the early afternoon on December 24 and reopen on December 29.
Optimism prevailed in Monday's trading as investors held out for a strong finish in 2025, driven by expectations of higher earnings.
Across Asia, benchmark indexes advanced nearly 2% in Tokyo and Seoul, edged higher 1% in Sydney, and gained a fraction in Taiwan and Malaysia.
China Stocks and Movers
The Hang Seng Index increased 0.3% to 25,768.64, and the mainland-focused CSI 300 index added 0.8% to 4,604.43.
E-commerce and AI-linked stocks dominated market gainers on Monday.
Alibaba Group advanced 1.1%, Tencent Holdings edged up 0.1%, Baidu Inc. jumped 2%, and Meituan inched higher 0.2%.
On the downside, ZTO Express, Xiaomi, and NetEase declined between 1% and 2%.
Four new companies listed on the Hong Kong Stock Exchange on Monday, as companies raced to complete initial public offerings ahead of the year's end.
BenQ BM Holding dropped nearly 40% to HK $5.75, and the general hospital group priced its initial public offering at HK $9.34 per share.
The company raised HK$625.8 million in gross proceeds through the sale of 67 million shares.
B&K Corporation Ltd. dropped 7% to HK $35.40, and the biopharma company priced its offering at HK $38.20 per share.
The protein therapy-focused company raised gross proceeds of HK $674.2 million through the sale of 17.6 million shares.
Impression Dahongpao plunged more than 25% to HK $2.70, and the cultural tourism-focused company priced its initial offering at HK $3.60 per share.
The cultural tourism services provider and hotel management company raised gross proceeds of HK $129.96 million through the sale of 36.1 million shares.
Nanhua Futures decreased 19% to HK $9.50, and the company priced its initial public offering at HK $12.0 per share.
The futures brokerage company raised gross proceeds of HK $1.3 billion through the sale of 107.6 million shares.
U.S. Movers: FedEx, Nike
Scott Peters
19 Dec, 2025
New York City
Nike Inc. dropped 10.5% to $58.75 despite the athletic shoemaker's quarterly results surpassing market expectations, but sales weakness in China and U.S. tariff-driven hits to overall margins pressured the stock.
Revenue in the fiscal second quarter ending in November increased 1% to $12.4 billion from $12.35 billion, net income plunged 32% to $792 million from $1.2 billion, and diluted earnings per share dropped to 53 cents from 78 cents a year ago.
Nike said gross margin decreased 300 basis points to 40.6% and inventories declined 3% to $7.7 billion, primarily due to higher tariffs in the U.S.
The increase in North America sales by 9% to $5.6 billion from $5.2 billion was offset by a 17% plunge in Greater China sales to $1.4 billion from $1.7 billion a year ago.
FedEx Corp. decreased 2.2% to $281.0, and the parcel delivery company's fiscal second-quarter results topped market expectations.
Revenue in the fiscal second quarter of 2026 ending in November increased 7% to $23.5 billion from $22.0 billion, net income increased 29% to $956 million from $741 million, and diluted earnings per share jumped 33% to $4.04 from $3.03 a year ago.
FedEx confirmed it is on track to change its fiscal year-end to December 31 from May 31, effective June 1, 2026.
The company revised its fiscal 2026 revenue growth outlook to range between 5% and 6% from the previous range between 4% and 6%.
FedEx revised its diluted earnings per share range to between $14.60 and $16.0 from the previous estimated range between $14.20 and $16.0, before retirement plan accounting adjustments.
The Memphis, Tennessee-based company lowered its pension contributions estimate to $275 million, compared to the prior forecast of up to $400 million. The company reiterated its capital expenditure estimate of $4.5 billion in the current fiscal year.
U.S. Movers: FedEx, Nike
Scott Peters
19 Dec, 2025
New York City
Nike Inc. dropped 10.5% to $58.75 despite the athletic shoemaker's quarterly results surpassing market expectations, but sales weakness in China and U.S. tariff-driven hits to overall margins pressured the stock.
Revenue in the fiscal second quarter ending in November increased 1% to $12.4 billion from $12.35 billion, net income plunged 32% to $792 million from $1.2 billion, and diluted earnings per share dropped to 53 cents from 78 cents a year ago.
Nike said gross margin decreased 300 basis points to 40.6% and inventories declined 3% to $7.7 billion, primarily due to higher tariffs in the U.S.
The increase in North America sales by 9% to $5.6 billion from $5.2 billion was offset by a 17% plunge in Greater China sales to $1.4 billion from $1.7 billion a year ago.
FedEx Corp. decreased 2.2% to $281.0, and the parcel delivery company's fiscal second-quarter results topped market expectations.
Revenue in the fiscal second quarter of 2026 ending in November increased 7% to $23.5 billion from $22.0 billion, net income increased 29% to $956 million from $741 million, and diluted earnings per share jumped 33% to $4.04 from $3.03 a year ago.
FedEx confirmed it is on track to change its fiscal year-end to December 31 from May 31, effective June 1, 2026.
The company revised its fiscal 2026 revenue growth outlook to range between 5% and 6% from the previous range between 4% and 6%.
FedEx revised its diluted earnings per share range to between $14.60 and $16.0 from the previous estimated range between $14.20 and $16.0, before retirement plan accounting adjustments.
The Memphis, Tennessee-based company lowered its pension contributions estimate to $275 million, compared to the prior forecast of up to $400 million. The company reiterated its capital expenditure estimate of $4.5 billion in the current fiscal year.
Investors Questioned Cooler U.S. Inflation Report, Benchmark Indexes Under Pressure
Barry Adams
19 Dec, 2025
New York City
Stocks on Wall Street lacked momentum, and investors debated the accuracy of the latest inflation update.
The S&P 500 index decreased 0.1%, and the tech-heavy Nasdaq Composite decreased 0.2% amid growing skepticism about the latest consumer price inflation report.
Benchmark indexes headed higher on Thursday after November's inflation weakened to 2.7% and the core rate held at 2.6%.
However, investors worried that the methodology used to calculate the cost of shelter may understate the overall inflation by a significant margin.
The U.S. Bureau of Labor Statistics estimated the owner's equivalent inflation rate at zero, because the 43-day government shutdown prevented the federal agency from collecting key economic data.
The shelter cost is likely to be sharply revised in December's inflation report, which could reaccelerate overall inflation to above 3.2%, higher than the Fed's target rate.
Moreover, the federal government shutdown also prompted retailers to launch holiday sales earlier than usual, contributing to a downward pressure on the index.
In international news, major central banks announced their rate decision on Thursday and Friday.
The Bank of Japan increased its short-term rate by 25 basis points to 0.75%, increasing rates to a 30-year high, as policymakers race to normalize policy after a decade of an ultra-loose stance.
On Thursday, the European Central Bank and the Bank of England announced their rate decisions, matching market expectations.
The ECB held steady its reference rate at 2% and lifted its GDP growth outlook as inflation hovered near the 2% target rate.
The Bank of England trimmed its policy rate by 25 basis points to 3.75% and signaled that, despite the weakening inflationary forces, future rate cuts are not assured in February and March 2026.
U.S. Movers
Nike Inc. dropped 10.5% to $58.75 despite the athletic shoemaker's quarterly results surpassing market expectations, but sales weakness in China and U.S. tariff-driven hits to overall margins pressured the stock.
FedEx Corp. decreased 2.2% to $281.0, and the parcel delivery company's fiscal second-quarter results topped market expectations.
Investors Questioned Cooler U.S. Inflation Report, Benchmark Indexes Under Pressure
Barry Adams
19 Dec, 2025
New York City
Stocks on Wall Street lacked momentum, and investors debated the accuracy of the latest inflation update.
The S&P 500 index decreased 0.1%, and the tech-heavy Nasdaq Composite decreased 0.2% amid growing skepticism about the latest consumer price inflation report.
Benchmark indexes headed higher on Thursday after November's inflation weakened to 2.7% and the core rate held at 2.6%.
However, investors worried that the methodology used to calculate the cost of shelter may understate the overall inflation by a significant margin.
The U.S. Bureau of Labor Statistics estimated the owner's equivalent inflation rate at zero, because the 43-day government shutdown prevented the federal agency from collecting key economic data.
The shelter cost is likely to be sharply revised in December's inflation report, which could reaccelerate overall inflation to above 3.2%, higher than the Fed's target rate.
Moreover, the federal government shutdown also prompted retailers to launch holiday sales earlier than usual, contributing to a downward pressure on the index.
In international news, major central banks announced their rate decision on Thursday and Friday.
The Bank of Japan increased its short-term rate by 25 basis points to 0.75%, increasing rates to a 30-year high, as policymakers race to normalize policy after a decade of an ultra-loose stance.
On Thursday, the European Central Bank and the Bank of England announced their rate decisions, matching market expectations.
The ECB held steady its reference rate at 2% and lifted its GDP growth outlook as inflation hovered near the 2% target rate.
The Bank of England trimmed its policy rate by 25 basis points to 3.75% and signaled that, despite the weakening inflationary forces, future rate cuts are not assured in February and March 2026.
U.S. Movers
Nike Inc. dropped 10.5% to $58.75 despite the athletic shoemaker's quarterly results surpassing market expectations, but sales weakness in China and U.S. tariff-driven hits to overall margins pressured the stock.
FedEx Corp. decreased 2.2% to $281.0, and the parcel delivery company's fiscal second-quarter results topped market expectations.
BoJ Delivered Widely Anticipated Rate Increase and Signaled Readiness for Future Hikes
Akira Ito
19 Dec, 2025
Tokyo
Japan's indexes advanced after the Bank of Japan delivered a widely anticipated rate hike, and investors reviewed the latest inflation update.
The Nikkei 225 Stock Average gained 1.1%, the broader Topix increased 0.9%, and the yen approached the 156 mark against the U.S. dollar.
The Bank of Japan increased its key short-term interest rate by 25 basis points to 0.75%, matching the market expectations.
The central bank raised rates to the highest level in 30 years after inflation stayed above the policymakers' target rate of 2% for the 44th consecutive month in November.
The central bank signaled that future rate hikes are likely if its estimate of wage hikes and inflation materializes, confirming market expectations of as many as two rate hikes in 2026.
Japan's central bank ended its ultra-loose monetary policy last year and raised rates two times to 0.5% as the surging food prices drove the overall inflation rate above the 2% level for nearly four years.
The Bank of Japan, in its post-meeting statement, reiterated its inflation outlook to converge to 2% before the end of fiscal year 2027.
The overall inflation eased slightly to 2.9% in November from 3.0% in October, and the core rate, which excludes volatile food prices, held steady at 3.0% during the same period.
The yield on the 10-year Japanese government bond inched higher by 3.0 basis points to 2.0%, reaching the highest level since May 2026.
Japan Indexes and Stocks
Benchmark indexes advanced in Tokyo trading on Friday, supported by the BoJ's rate action and higher closing in overnight trading in New York.
The Nikkei 225 Stock Average increased 1.1% to 49,533.07, and the broader Topix inched higher 0.9% to 3,385.83.
After a week of volatile trading, the Nikkei 225 Stock Average closed down 1.5%, and the Topix fell 1.2%.
Softbank Group Holding advanced 6.6% to ¥17,150.0, Tokyo Electron Ltd. increased 3% to ¥31,220.0, and Advantest Corp. added 2.2% to ¥19,235.0.
Mitsubishi UFJ Financial Group increased 1.5% to ¥2,465.50, Sumitomo Mitsui Financial Group advanced 2.3% to ¥5,025.0, and Mizuho Financial Group gained 1.1% to ¥5,665.0.
BoJ Delivered Widely Anticipated Rate Increase and Signaled Readiness for Future Hikes
Akira Ito
19 Dec, 2025
Tokyo
Japan's indexes advanced after the Bank of Japan delivered a widely anticipated rate hike, and investors reviewed the latest inflation update.
The Nikkei 225 Stock Average gained 1.1%, the broader Topix increased 0.9%, and the yen approached the 156 mark against the U.S. dollar.
The Bank of Japan increased its key short-term interest rate by 25 basis points to 0.75%, matching the market expectations.
The central bank raised rates to the highest level in 30 years after inflation stayed above the policymakers' target rate of 2% for the 44th consecutive month in November.
The central bank signaled that future rate hikes are likely if its estimate of wage hikes and inflation materializes, confirming market expectations of as many as two rate hikes in 2026.
Japan's central bank ended its ultra-loose monetary policy last year and raised rates two times to 0.5% as the surging food prices drove the overall inflation rate above the 2% level for nearly four years.
The Bank of Japan, in its post-meeting statement, reiterated its inflation outlook to converge to 2% before the end of fiscal year 2027.
The overall inflation eased slightly to 2.9% in November from 3.0% in October, and the core rate, which excludes volatile food prices, held steady at 3.0% during the same period.
The yield on the 10-year Japanese government bond inched higher by 3.0 basis points to 2.0%, reaching the highest level since May 2026.
Japan Indexes and Stocks
Benchmark indexes advanced in Tokyo trading on Friday, supported by the BoJ's rate action and higher closing in overnight trading in New York.
The Nikkei 225 Stock Average increased 1.1% to 49,533.07, and the broader Topix inched higher 0.9% to 3,385.83.
After a week of volatile trading, the Nikkei 225 Stock Average closed down 1.5%, and the Topix fell 1.2%.
Softbank Group Holding advanced 6.6% to ¥17,150.0, Tokyo Electron Ltd. increased 3% to ¥31,220.0, and Advantest Corp. added 2.2% to ¥19,235.0.
Mitsubishi UFJ Financial Group increased 1.5% to ¥2,465.50, Sumitomo Mitsui Financial Group advanced 2.3% to ¥5,025.0, and Mizuho Financial Group gained 1.1% to ¥5,665.0.