The Nikkei 225 is expected to remain firm after rebounding on the 4th. While easing concerns about rising interest rates in US markets are likely to support stocks, continued yen appreciation and expectations of a Bank of Japan rate hike are expected to cap gains in export-related stocks.
Tokyo stocks are expected to benefit on the 4th from easing concerns about rising interest rates in the previous day's US market, which supported higher stock prices. At the same time, with concerns remaining about rising long-term interest rates in the yen bond market, the yen is expected to strengthen in the foreign exchange market to around the upper ¥155 range against the dollar and the lower ¥181 range against the euro. Expectations of a substantial Bank of Japan rate hike are also likely to remain in focus, potentially weighing on some export-related stocks.
In yen terms, ADRs of Kioxia, SUMCO, Nippon Steel and others closed above the previous day's levels, raising the possibility that buying driven by US market trends will lead the market at the open. Meanwhile, the yen-denominated settlement price for Chicago Nikkei 225 futures was ¥64,560, up ¥330 from the previous day.
The main economic indicators and events scheduled for the 4th include Japan's July Family Income and Expenditure Survey at 8:30 and the US August employment report at 21:30 Japan time. Market participants are expected to adopt a stronger wait-and-see stance in the latter part of the trading session ahead of the release of the US August employment report.
Provided by Wealth Advisor. This market outlook was prepared based on information from Wealth Advisor.