Against the backdrop of developments in the New York market, dollar/yen is expected to trade in the ¥158 range, while the Nikkei fell by approximately ¥13,000 into the ¥57,000 range. Attention will now focus on the US midterm election results and IMM positioning.
In the New York market on the 6th, dollar/yen rose temporarily to ¥158.58 before falling back to around ¥158.00 as US 10-year Treasury yields declined. Euro/dollar fell following the US employment report.
In the Tokyo market, dollar/yen is expected to be driven by movements in US stocks, and may strengthen or weaken depending on whether the Nasdaq Composite rebounds. The Nikkei has fallen by approximately ¥13,000 from the ¥70,000 range to around ¥57,000.
The Nikkei's decline has been heavily influenced by AI- and semiconductor-related stocks, and some believe market turbulence following the US midterm elections will continue. Overheating in data-center investment and developments in related stocks have been cited as risk factors.
Non-commercial positions in IMM currency futures consisted of net yen buying of 102321 contracts, yen selling of 124877 contracts and buying of 227198 contracts, and speculators are reportedly still expecting moves to curb yen depreciation.