Japanese equities are expected to see stronger interest in value stocks than growth stocks this week ahead of the end-September rights capture. Attention will be needed on market movements ahead of U.S. corporate earnings announcements and the Jackson Hole meeting.
The Nikkei Average ended last week at ¥66,405.56, up ¥389.20 from the previous weekend. Selling initially led the market, but buying to cover positions gathered pace from midweek onward, particularly in AI- and semiconductor-related stocks.
The market continued to rise on the 26th, ahead of NVIDIA's earnings announcement, apparently supported by a favorable reception to the content of its earnings briefing. However, the spillover effect on domestic related stocks, including Advantest, was limited.
With the Jackson Hole meeting approaching, developments in U.S. technology stocks and long-term interest rates are expected to be the focus of the Tokyo market. Economic indicators, including the employment report and the ISM Manufacturing Index, are also likely to determine the level of market caution.
The U.S. market may be closed for a three-day weekend because of Labor Day, and attention is warranted for periods when position adjustments may intensify.