Japanese Stock Market Rallies on Improved US Jobs Data
Japan‘s Nikkei stock index surged on Friday, recovering from earlier losses fueled by a surprise drop in US jobless claims and a weaker yen. The index closed up 1.6% to 35,380.23.
Market Reversal:
The reversal in sentiment came after US stocks closed sharply higher overnight on the back of the US jobs report, which raised fears of a looming recession. However, the data suggested a softer landing, leading to market relief.
Supporting Factors:
Weakening Yen: A slightly weaker yen boosted export-oriented stocks like Sony Group and Mazda Motor.
Reduced Trading Volume: Cautious investors adopted a wait-and-see approach ahead of the long weekend, leading to reduced trading volume.
Volatility Remains High:
Despite the recent rebound, analysts anticipate continued volatility in the week ahead as investors await further economic data to assess the health of the US economy.
Market Response to Economic Indicators:
Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management, highlighted the cautious market response to economic indicators, noting the ambiguity surrounding the pace of US economic slowdown.
Central Bank Policy Uncertainty:
The Bank of Japan’s recent interest rate hike raised questions about the pace of future monetary policy tightening, leading to market speculation.
Notable Stock Performance:
Recruit Holdings and Itochu Corp each surged by nearly 7%, among the top gainers in the index.
Tokyo Electron climbed over 10% before retracting slightly after company results were released.