The Tokyo market is expected to focus on USD/JPY movements and the Nikkei Average while keeping an eye on developments in the New York market. The market will focus on the US employment report, the impact of AI-related investment and trends in data-center investment.
In the New York market on the 6th, USD/JPY rose to ¥158.58 before falling back to around ¥158.00 as US 10-year Treasury yields declined. EUR/USD has fallen to $1.1131 following the strong US employment data.
The focus in today's Tokyo market will be how USD/JPY responds to developments in the New York stock market. USD/JPY is expected to strengthen or weaken depending on whether the Nasdaq rebounds. The Nikkei Average has remained on a long-term downtrend, with the impact of AI- and semiconductor-related stocks particularly evident in some areas.
Concerns about a bubble in data-center investment have been raised against the backdrop of the US midterm election results, prompting caution toward hyperscalers and hedge funds. The IMF's GFSR and the Bank of Japan's Financial System Report have pointed to related risks. USD/JPY will be assessed for its future direction while monitoring its movement near the upper cloud boundary of the Ichimoku chart.
As of 3 November, speculative positions in IMM currency futures showed net yen purchases of 102,321 contracts, sales of 124,877 contracts and purchases of 231,? (note: supplementary), suggesting that expectations for curbing yen depreciation remain in place.
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