Semiconductors and strong-earnings stocks are driving the index, with the focus in the afternoon session on whether the market can maintain its strength in the upper ¥66,000s. Expectations of lower interest rates are spreading against a backdrop of views that the US employment data may slow unexpectedly, supporting inflows into semiconductor and AI-related stocks.
The Nikkei Stock Average stood at 66,931.48, up 1,324.77 from the previous day, and has maintained its strength toward the end of the session. The index is expected to remain at a similar level in the afternoon session. The TOPIX was at 4,107.14, up 32.21, indicating the underlying strength of the broader market.
Market sentiment is being supported by views that concerns over interest rate hikes will recede against a backdrop of an improved outlook for the US employment data. Buying in semiconductor and AI-related stocks is expected to continue driving the market higher.
Stock picking based on earnings results has become more active, with Recruit Holdings, Terumo and Olympus among the stocks that at times hit their limit-up prices. Inflows into strong-performing stocks are being viewed as support for the broader market.
In the afternoon session, the market may face resistance ahead of ¥67,000, while selling is prominent in stocks whose earnings results disappointed. Stock selection is therefore expected to become increasingly important.