The Nikkei 225 traded around its morning close in afternoon trading, with its early gains narrowing as the session progressed. The index's upside remained significantly capped, and it continued to trade well below its 75-day moving average.
The Nikkei 225 has continued to trade on expectations of a rebound from the morning close in afternoon trading, although its gains have narrowed. The Nikkei 225 stood at 64,455.83, up 130.19 points from the previous day, while the TOPIX was at 4,124.08, up 42.48 points. With the market well below its 75-day moving average, some market participants expect selling by investors waiting for a rebound to remain a feature of trading conditions.
In U.S.-market-related developments, long-term interest rates reportedly declined following dovish comments from New York Fed President John Williams, which some believe had a somewhat positive effect on domestic investor sentiment. Employment-related indicators, however, were weak, leaving concerns about an economic slowdown.
Developments in the Middle East and crude oil prices have also been cited as factors likely to weigh on the market. Investors continue to wait for tonight's U.S. market to provide further direction.
Overall, the view is that, as an afternoon trading strategy, gains may continue to narrow even if buybacks lead the market higher.