Japanese Stocks Surge on Hopes of US-Iran Deal and Tech Sector Advances
Japanese Stocks Surge as Markets Reopen After Holiday Break
Japanese stocks rebounded sharply on Thursday as markets reopened after a holiday break, with investors catching up with the global equities rally driven by optimism that the US and Iran were nearing a deal to end their conflict. The tech-heavy Nikkei 225 Stock Average advanced as much as 4% to 61,902.23, while the broader Topix Index rose as much as 2.1% to 3,806.81.
The gains come as Japanese equities have been gaining on strong earnings from tech firms. The Nikkei topped the key psychological level of 60,000 last month on that rally. Lower oil prices also provided a boost to the market, with oil steadying after plunging 7% in the previous session. This is significant for companies, as even a modest easing of inflation can provide meaningful relief.
US stocks hit new highs on Wednesday after Washington was said to present a memorandum of understanding that would gradually reopen the Strait of Hormuz and lift the blockade on ports. Tech shares are also supporting the market in Tokyo after US chipmaker Advanced Micro Devices Inc. rallied on bullish results. Memory chipmaker Kioxia's shares are set to rise by their daily limit, while semiconductor-related companies such as Renesas Electronics Corp and Ibiden Co. were some of the top performers on the Nikkei 225 on Thursday.
Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data
A stronger yen may weigh on some export-related shares, however. The currency surged as much as 1.8% against the dollar on Wednesday, renewing speculation of intervention.
| Company | Previous Close | Current Close | Change |
|---|---|---|---|
| Advanced Micro Devices Inc. | $123.50 | $128.75 | 4.3% |
| Kioxia | $18.20 | $22.00 | 20.8% |
| Renesas Electronics Corp | $20.50 | $23.25 | 13.4% |
| Ibiden Co. | $13.80 | $16.20 | 17.4% |
Note: The table above shows the performance of select companies that were among the top performers on the Nikkei 225 on Thursday.
Investor Takeaway
Investors should be optimistic about the Japanese market's potential rise, driven by strong tech sector earnings and a possible US-Iran deal.
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