Japan's Nikkei squeezes out modest gains as yen, Wall Street weigh

Keyence

02/05/2024 03:59

By Brigid Riley
       TOKYO, May 2 (Reuters) - Japan's Nikkei share average
eked out meagre gains on Thursday, with the yen's sudden
appreciation and a mixed performance on Wall Street dragging on
sentiment.
    The Nikkei  .N225  was up 0.07% at 38,299.71 by the midday
close, with gains and losses relatively limited as investors
avoided making big moves before the market entered a long
holiday weekend.
    The broader Topix  .TOPX  gained 0.11% at 2,732.33.     
    The U.S. Federal Reserve's monetary policy meeting concluded
on Wednesday without any big surprises, with the central bank
standing pat. 
     While the Fed flagged that recent disappointing inflation
readings could make rate cuts a while in coming, it signalled it
is still leaning towards eventual reductions, giving some
solace.
    "Many investors were worried the Fed may hike (again) if
inflation continued to remain high, but Fed Chair Powell
suggested that the likelihood of a further rate hike is low, so
I think that was assuring," said Kenji Abe, an equities
strategist at Daiwa Securities.
    But a surge in the yen against the dollar after the Fed's
meeting, suspected by traders to be another round of
intervention by Tokyo, muted gains by export-related shares
which tend to benefit from a weaker currency.
    The dollar was last trading around 155.84 yen  JPY= .
    Automakers Toyota Motor  7203.T  and Honda Motor  7267.T 
both managed modest wins, up 0.3% and 0.1%, respectively.
    Sony Group  6758.T  fell 0.2%, while Keyence Corp  6861.T 
was up 0.1%.
    At the same time, U.S. stocks were mixed overnight, with the
Philadelphia Semiconductor Index  .SOX  in particular taking a
hit after weak quarterly results from tech firms Advanced Micro
Devices  AMD.O  and Super Micro Computer  SMCI.O .  .N 
    The snag in the tech rally abroad capped gains of
chip-making equipment giant Tokyo Electron  8035.T  at 0.7%. 
    Chip-testing equipment maker Advantest  6857.T  slid 0.2%,
and AI-focused startup investor SoftBank Group  9984.T  fell
0.3%. 
    

 (Reporting by Brigid Riley; Editing by Janane Venkatraman
)
 ((brigid.riley@thomsonreuters.com;))