Dividend-capture buying is expected to provide support, with the Nikkei Average likely to remain firm in the ¥66,000 range. Today's expected range for the Nikkei 225 is ¥66,000-¥67,000.
The Dow extended its gains in the New York market on the 25th, and while US long-term interest rates remained high amid broad buying of US stocks, supply-demand factors ahead of the ex-dividend date were seen as providing support for the Nikkei Average.
In Japan, buying aimed at capturing dividends is expected ahead of the ex-dividend date and is seen supporting the Nikkei Average's downside. Moves above the previous day's close and above the 25-day moving average were indicated.
On the 30th, buying demand associated with Nikkei Average rebalancing and cap adjustments for Advantest are expected to spread to Nikkei constituent stocks, leading some to expect limited downside. However, developments involving the Japanese and US finance authorities and movements in the yen require attention, and the momentum for further gains is considered limited.
Upside reference levels for the Nikkei Average include ¥66,399, the rebound high at the 7 September closing level; ¥66,611, the 75-day moving average; the psychological ¥67,000 level; and the area around ¥67,368, the low recorded around 18 August. Downside levels are expected around ¥66,000 and ¥65,274, near the 25-day moving average.