Tokyo stocks are expected to open higher on the 4th. Against the backdrop of gains in US equities, Nikkei 225 futures are holding at elevated levels, with the cash market’s range for the year expected to be approximately ¥63,900 to ¥65,400.
US equities all rose by more than 1% the previous day, with the Dow, Nasdaq and S&P all posting gains. Remarks by Federal Reserve Governor Waller broadened expectations that the policy rate would remain unchanged at the September FOMC. Against this backdrop, Nikkei 225 futures remained firm in overnight trading and closed at ¥64,660.
In Japan, reports have emerged that Prime Minister Takaichi Sanae (高市早苗) plans to retain Katayama Satsuki (片山さつき) as Minister of Finance in a cabinet reshuffle. In the yen-denominated bond market, there is a view that long-term interest rates are likely to decline, and attention is focused on the impact of advancing fiscal policy on long-term interest rates.
Meanwhile, the dollar-yen rate moved sharply toward the ¥155 range on expectations that the Bank of Japan may accelerate its rate hikes, potentially capping gains in export-related stocks. Expectations for Toyota Motor Corporation’s capacity for share buybacks and movements in gold prices are being viewed as catalysts for individual stocks.
In the US market, the Dow extended its gains on the 3rd, and the Japanese market’s reaction is expected to depend on movements in long-term interest rates. Domestic indicators, including the release of the July Family Income and Expenditure Survey for all households and imported vehicle sales figures, are also drawing attention.
Gold-related stocks, including Sumitomo Metal Mining Co., Ltd., are likely to show mixed reactions depending on the retreat in expectations for US rate hikes and movements in gold futures.