Japan Indexes Edged Higher Amid Rate Path Uncertainties and Ahead of Governme

Akira Ito
26 Dec, 2024
Tokyo

Stock market indexes in Tokyo advanced for the second session in a row amid interest rate uncertainties and elevated geopolitical tensions. 

The Nikkei 225 stock average gained 0.9%, and the broader TOPIX index advanced 1.1%, as investors debated future rate paths in the months ahead. 

The Japanese yen drifted to 157.44 against the U.S. dollar. 

Japan has engaged in unusual and aggressive diplomatic efforts in wooing the incoming U.S. presidential administration, as Prime Minister Shigeru Ishiba's administration looks to ramp up defense spending and provide additional economic stimulus. 

The LDP-led coalition government made a number of concessions to opposition parties in passing new legislation, raising hopes that the government will provide additional stimulus to low-income and senior citizens. 

Moreover, Japan's government is also looking to ramp up its defense spending amid rising threats from the rapidly modernizing and aggressive Chinese military. 

Financial markets in Europe, Australia, and Hong Kong are closed for a holiday on Thursday, and December 30th is the last trading day for Japanese markets. 

Bank of Japan Governor Kazuo Ueda said in a speech that Japan's economy is moving closer to achieving sustainable 2% inflation but failed to clarify the central bank's stance ahead of the next policy meeting in January. 

The Bank of Japan is likely to hold rates at its next meeting, awaiting spring wage negotiations and clarity on the trade policy of the incoming U.S. presidential election in early February. 

 

Japan Stock Movers 

The Nikkei 225 Stock Average rose 0.9% to 39,499.14, and the broader TOPIX index advanced 1.1% to 39,499.14. 

Tech stocks advanced in Tokyo following gains in New York in Tuesday's trading. 

Tokyo Electron increased 0.6% to ¥23,830.0, Advantest Corp. increased 1.2% to ¥9,095.0, and Screen Holdings decreased 0.2% to ¥9,397.0. 

Financial stocks traded mixed after the yen drifted lower as investors dialed down rate-increase expectations at the next policy meeting in January. 

Sumitomo Mitsui Financial Group advanced 1.2% to ¥3,742.0, Mizuho Financial Group gained 0.9% to ¥3,863.0, and Mitsubishi UFJ Financial Group increased 0.6% to ¥1,811.0. 

Toyota Motor jumped 6% to ¥3,142.0, Honda Motor added 3.8% to ¥1,500.0, Nissan Motor increased 6.6% to ¥552.40, and Mitsubishi Motor advanced 6.5% to ¥562.90. 

Toyota Motor said it plans to increase its return on equity to 20% by 2030. 

Japan Airlines declined 0.3% to ¥562.90 after the company confirmed a cyberattack early this morning disrupting its internal and external systems. 

The company said the attack started at 7:24 a.m. Tokyo time, forcing the airline to temporarily disable its network router, leading to system malfunctions and suspension of its ticketing system. 

Fast Retailing advanced 0.3% to ¥53,250.0, Isetan Mitsukoshi jumped 7.6% to ¥2,711.50, and Seven & I Holding Co. Ltd. decreased 0.5% to ¥2,452.50. 

J. Front Retailing soared 8.3% to ¥2,159.0 after the department store chain operator reported strong quarterly results in the nine-month period ending in September. 

Consolidated gross sales for the nine-month period increased 10.3% to 315.9 billion yen, pre-tax profit soared 65.4% to 49.4 million yen, and basis earnings per share inched higher to 143.04 yen from 142.84 yen.