Japan Stocks Brave Ahead Despite Growing Turmoil In Middle East

Akira Ito
04 Oct, 2024
Tokyo

Stock market indexes in Tokyo advanced, and the yen dropped to a one-month low as investors overlooked rising tensions in the Middle East and the sharp rise in the crude oil prices. 

The Nikkei 225 stock average increased 0.5% and the Topix index gained 0.4%, and both benchmark indexes advanced nearly 1.5% in the week. 

Market indexes traded higher despite rising tensions in the Middle East and crude oil prices soaring as much as 5% in international trading. 

For the week, crude oil prices have surged more than 8% as Israel stepped up its bombing attacks in Lebanon and escalated its land-grabbing activities in Gaza. 

Moreover, the ongoing worker strike at 14 key ports on the U.S. East and Gulf Coasts has also impacted sentiment for Japanese exports to the region. 

The yen weakened 0.5% to 146.08 following comments from the newly elected prime minister, Shigeru Ishiba, supporting a gradual increase in the interest rate. 

The unexpected comments from Ishiba's cast doubt about the possibility of another rate cut this year as the Bank of Japan awaits additional rate cuts in the U.S. and Europe. 

The large swings in the yen with a spillover effect on the stock market confirm that investors are still nervous about the future rate outlook and fiscal spending outlook under the new leadership.

 

Japan Stock Movers 

The Nikkei 225 stock average added 0.5% to 38,630.54, and the broader Topix index edged up 0.4% to 2,694.21. 

Tech stocks led the gainers in Tokyo trading and extended weekly gains following the rebound in semiconductor-related stocks. 

Advantest Corp. increased 1.2% to ¥6,950.0, Tokyo Electron fell 2% to ¥25,245.0, Lasertec added 0.04% to ¥23,715.0, and Shin-Etsu Chemical Company decreased 0.7% to ¥6,001.0. 

Shipping companies plunged following the escalation of violence in the Middle East and the ongoing dockworker strike in the U.S. East and Gulf Coasts. 

Nippon Yusen plunged 9.3% to ¥4,977.0, Mitsui O.S.K. Lines dropped 6.3% to ¥4,820.0, and Kawasaki Kisen Kaisha declined 9.6% to ¥2,070.0. 

Retailers participated in the market rebound as the weaker yen boosted demand from foreign tourists. 

Seven & I Holdings increased 3.5% to ¥2,194.50, Fast Retailing advanced 1.4% to ¥49,140.0, and Isetan Mitsukoshi added 0.5% to ¥2,309.0. 

Mitsubishi UFJ Financial increased 2.2% to ¥1,480.50, Sumitomo Mitsui added 1.9% to ¥3,089.0, and Mizuho Financial gained 1.6% to ¥2,966.50.