Japan's Nikkei hits record high as chip-related shares track US peers

Shin-Etsu Chemical

09/07/2024 04:10

TOKYO, July 9 (Reuters) - Japan's Nikkei share average
hit a record high on Tuesday, with chip-related stocks tracking
U.S. peers higher as investors awaited testimony from Federal
Reserve Chair Jerome Powell for clues for the rate path.
    The Nikkei  .N225  ended the midday session with a record
high, up 1.49% at 41,386.8.
    "The market expects Powell's comments will indicate policy
easing, which lifted U.S. chip stocks overnight and the Japanese
chip makers tracked the trend," said Takehiko Masuzawa, trading
head of Phillip Securities Japan.
    The S&P 500 and Nasdaq notched record-high closes on Monday,
with Nvidia  NVDA.O  rising 2% and Intel  INTC.O  rallying more
than 6%, lifting the Philadelphia semiconductor index  .SOX 
1.9%.  .N 
    Powell will speak to Congress on Tuesday and Wednesday.
    Traders now see a greater than 75% chance of a rate cut of
at least 25 basis points by September, up from last week's 60%,
according to CME's FedWatch.
    In Japan, chip-making equipment maker Tokyo Electron
 8035.T  jumped 3.88%, giving the biggest support to the Nikkei.
Chip-testing equipment maker Advantest  6857.T  climbed 3.17%.
    The U.S. rate cut expectations weighed on Japanese bank
stocks, sending the banking index  .IBNKS.T  0.59% lower. The
index for value shares  .TOPXV  inched up 0.19%, while the 
growth stock index  .TOPXG  jumped 1.07%.
    The broader Topix  .TOPX  was up 0.62% to 2,885.37.
    Investors were cautious about the possible impact of a
sell-off in exchange-traded funds on Wednesday, a move to
distribute payouts, which market players estimated to be worth
about 750 billion yen ($4.66 billion), said Phillip Securities
Japan's Masuzawa. 
     
    
   

($1 = 160.9800 yen)

 (Reporting by Junko Fujita; Editing by Mrigank Dhaniwala)
 ((junko.fujita@thomsonreuters.com;))