Japan's Nikkei closes at 3-week high on US rate-cut outlook, tech boost

Disco

07/05/2024 07:37

(Updates with closing levels)
    By Brigid Riley
       TOKYO, May 7 (Reuters) - Japan's Nikkei share average
jumped more than 1% on Tuesday, as investor sentiment brightened
on higher bets of U.S. interest rate cuts this year while
technology shares continued to dazzle.
    The Nikkei  .N225  rose 1.57% to 38,835.10, its highest
closing level since April 15.
    The broader Topix  .TOPX  finished up 0.65% at 2,746.22.    
    U.S. stocks injected fresh momentum as markets priced in a
higher chance of the Federal Reserve cutting interest rates this
year. A U.S. jobs report on Friday showing growth slowed more
than expected in April further fuelled buying.  .N 
    Japanese shares broadly climbed on the positive news, with
152 of the Nikkei's 225 constituents trading in green.
    Local technology shares advanced as investors returning from
a long weekend caught up to buoyant Wall Street after U.S. tech
giant Apple posted upbeat revenue results. The session's gains
significantly added to the Nikkei's near 600-point climb.      
    Japan's financial markets were closed on Friday and Monday
for a public holiday. 
    After fears had grown that no cuts would be made in 2024,
the Nikkei was experiencing a bit of a "relief rally", said Naka
Matsuzawa, chief macro strategist at Nomura Securities. 
    Some bumps may still be in store, however, as market
participants and central bank officials look to upcoming data to
confirm the Fed rate-cut story, he added.
    In individual stocks, chip-making equipment giant Tokyo
Electron  8035.T  soared 5.2% to add 179.47 index points alone,
while chip-related firm Disco Corp  6146.T  jumped nearly 9% to
become the best percentage performer of the day.
    AI-focused startup investor SoftBank Group  9984.T  gained
3.7%. Chip-testing equipment maker Advantest  6857.T  was up
2.3%.
    Outside of tech, Nikkei heavyweight and Uniqlo parent firm
Fast Retailing  9983.T  rose 3.2% to contribute an additional
126.51 points to the index.
    Sony Group Corp  6758.T  and pharmaceutical company Daiichi
Sankyo  4568.T  stumbled, declining 2.9% and 3.2%, respectively.
   

 (Reporting by Brigid Riley; Editing by Sherry Jacob-Phillips
and Mrigank Dhaniwala)
 ((brigid.riley@thomsonreuters.com;))