The Nikkei 225 climbed 1.15% to 38,893.44 on Monday as positive sentiment emerged following a high-profile meeting between former U.S. President Donald Trump and Chinese President Xi Jinping. Discussions covered critical issues such as TikTok, fentanyl, and trade, with Trump describing the talks as “very good.” This boosted investor confidence, particularly as TikTok resumed U.S. operations after a three-month pause.
Market participants are closely monitoring Trump’s upcoming policy announcements, which could influence key sectors like semiconductors, electric vehicles (EVs), and shipbuilding. Tax cuts and tariffs are expected to shape corporate outlooks, with heightened focus on the tech rivalry with China.
Picture: Nikkei 225 climbs to 38,912.15, gaining 1.55% with resistance at 39,037 and bullish momentum stabilising, as seen on the VT Markets app.
Looking at the 15-minute chart, the Nikkei 225 has gained 1.55%, closing at 38,912.15 after reaching an intraday high of 39,037.15. The index rebounded from a low of 38,061.15, maintaining an upward trajectory supported by the moving averages (5, 10, and 30-period), which are aligned in a bullish pattern.
The price is consolidating near resistance, suggesting a potential breakout or pullback. The MACD histogram shows diminishing bullish momentum, with the lines flattening, indicating a possible slowdown in buying pressure.
Despite the market’s upbeat tone, recent economic data presented a mixed picture. Japan’s machinery orders fell 14.4% in November compared to the previous month, although core private-sector orders showed resilience with a 3.4% increase, according to the Cabinet Office.
Industrial production declined by 2.2% month on month and 2.7% year on year, reflecting ongoing challenges within the manufacturing sector. The tertiary industry activity index, which measures service sector performance, dipped 0.3% monthly but posted a 0.9% annual gain, indicating steady consumer demand.
Japanese corporations reported promising forecasts despite economic headwinds. Game developer Nexon expects to generate 4.1 trillion won in revenue, while Krafton forecasts 2.7 trillion won, fuelled by strong demand for its “Battleground” intellectual property in India, as reported by Pulse News.
Pharmaceutical company Shionogi & Co secured a $375 million contract from the U.S. Biomedical Advanced Research and Development Authority (BARDA) to develop a long-acting COVID-19 antiviral, with clinical trials set to begin in 2025.
In the technology sector, Rakus Co announced plans to establish a Jakarta-based subsidiary in April, aiming to expand its cloud services with an initial capital investment of 10 billion rupiah, tapping into Southeast Asia’s growing digital transformation landscape.
As the Nikkei 225 continues its upward trajectory, traders are expected to focus on further developments in U.S.-China relations and upcoming economic indicators.
The potential rollout of Trump’s economic policies, including possible tax cuts and tariff adjustments, remains a key factor that could influence the market’s direction.
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