Japan's Nikkei shakes off chip slump as value shares rally

Daiwa Securities

25/06/2024 03:55

By Brigid Riley
       TOKYO, June 25 (Reuters) - Japan's Nikkei share average
edged higher during the morning session on Tuesday, as investors
shifted focus to value stocks over semiconductor and other
high-tech shares, while a yen on the back foot continued to
support export-related stocks. 
    The Nikkei  .N225  was up 0.51% at 39,001.39 by the midday
break, while the broader Topix  .TOPX  climbed 1.44% to
2,779.59.
    U.S. semiconductor bellwether Nvidia  NVDA.O  slid for a
third session on Monday, while the chip stocks index  .SOX 
finished down 3.02%, dampening investor sentiment toward
artificial intelligence- and chip-related shares during Asian
trading hours. .N 
    Disco Corp  6146.T  shares declined 5.3% to be the largest
percentage losers, and Tokyo Electron  8035.T  fell 2.5% to
single-handedly swipe 86 points off the benchmark index.
    AI-focused startup investor SoftBank Group  9984.T  slipped
1.7% to become the second biggest drag. 
    But a weaker yen continued to support export-related shares
that tend to benefit from a soft domestic currency, which
hovered close to a 34-year low of 160.245 per dollar.  FRX/ 
    Meanwhile, investors picked up value stocks over their
growth peers, generating widespread gains in the financial
sector to help lift the Nikkei.
    Banks  .IBNKS.T  added 3.5% to lead sector gains, followed
closely by insurance  .IINSU.T  and securities  .INSECU.T 
firms, both up around 3.3%.
        "Nikkei is a more value-oriented market, and investors
may be rebalancing during the approaching quarter-end to gain
exposure to the lagging part of the market," Charu Chanana,
global market strategist and head of FX strategy at Saxo said.
    "A selective and bottoms-up approach for Japanese stocks
could be attractive from here as yen appreciation risks escalate
in H2." 
    Among financial stocks, Daiwa Securities Group  8601.T 
jumped 4.2%, Mitsubishi UFJ Financial Group  8306.T  gained
4.1%, and Resona Holdings  8308.T  rose about 4%.
    Shares of Mizuho Financial Group  8411.T  were up 3.7%.
    In other individual stocks, auto maker and index heavyweight
Toyota Motor  7203.T  rallied 3.8%.

   

 (Reporting by Brigid Riley; Editing by Mrigank Dhaniwala)
 ((brigid.riley@thomsonreuters.com;))