Japan's Machinery Orders Remained Volatile In May, Tech Stocks Extended 2-Day Gain

Akira Ito
15 Jul, 2026
Tokyo

Japan's indexes extended their 2-day gain on Wednesday and overlooked escalating tensions in the Middle East. 

The Nikkei 225 Stock Average increased 1.5%, the broader TOPIX advanced 1.2%, and the yen inched down to 162.16 against the U.S. dollar. 

Stocks in Tokyo trading closed higher, tracking gains in overnight trading in New York driven by a leg up in advanced semiconductor and memory module makers.  

Market sentiment improved after the softer-than-expected U.S. inflation reduced expectations of a near-term interest rate hike. 

The annual pace of inflation eased to 3.5% in June from 4.2% in May as lower oil prices moderate energy inflation. On a monthly basis, consumer prices fell 0.4% from the previous month, marking the first monthly decline since 2020.  

The Brent crude oil price rose 1% to $85.60 a barrel following renewed military exchanges between the U.S. and Iran, raising the risks of further disrupting transportation of oil and gas through the Strait of Hormuz. 

Japan's core machinery orders, which exclude volatile sectors such as ships and electric utilities, dropped 12.4% from the previous month to 962 billion yen in May, reversing an 8.7% gain in the previous month. 

On an annual basis, orders decreased 1.5%, swinging from April's 15.6% rise and falling at the fastest pace since December 2025, said the Cabinet Office.    

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average increased 1.5% to 68,751.51, and the broader TOPIX advanced 1.2% to 4,088.12. 

Technology and AI-related stock led gainers in Tokyo on Wednesday. 

Kioxia Holdings rose 5.8% to ¥73,100.0, Advantest Corp. increased 5.8% to ¥31,510.0, Tokyo Electron advanced 4.4% to ¥74,240.0, and Taiyo Yuden closed up 6.3% to ¥12,605.0.