The Tokyo stock market on the 2nd is expected to search for a bottom, led by semiconductor and AI-related stocks, with downside risk from the previous close in focus. Volatility factors are likely to remain depending on the direction of US equities even after the Bank of Japan left interest rates unchanged.
The Tokyo stock market is expected to open lower for a second straight session on the 2nd, with the market expected to search for a bottom, led by semiconductor and AI-related stocks. The previous day’s Nikkei 225 close was ¥63,290.11, while Osaka market overnight futures are expected to trade around ¥870 below the cash-market close. The dollar-yen rate is trading in the mid-¥157 range, and the impact of weaker US semiconductor stocks is likely to outweigh the support from yen depreciation.
In earnings-related developments, Kioxia was sold in overnight trading after its profit outlook for October–December came in below market expectations. Lasertec also plunged after its earnings announcement, and selling pressure on semiconductor-related stocks is expected to intensify alongside the decline in the SOX Index. By contrast, Tokyo Electron sharply raised its earnings forecast and remained at a high level in private trading.
The Bank of Japan left its policy rate unchanged at 1.25% on the 30th, but in the short term, movements in US technology stocks are likely to have a greater influence on the market. While dip-buying around ¥62,000 is expected to be a focus for the Nikkei 225, the Tokyo market will be closed for Culture Day on the 3rd, and a cautious mood is likely to return ahead of US economic data, corporate earnings and the US midterm elections.