Key points
Japan’s Nikkei 225 index (Symbol: Nikkei225) rebounded from a three-week low in the previous session, as chip-sector stocks triggered an overnight rally.
The Nikkei ended the morning session high at 39,676.34, poised to snap a four-day losing streak that pulled the benchmark index as low as 39,519.39 since 2 July 2024.
Picture: Japan’s Nikkei rebounds as chipmakers and shippers lead rally, as observed on the VT Markets app.
The index rose but failed to sustain the psychological 40,000 mark. The Nikkei’s three biggest points advancers were all chip-related stocks led by chip-testing equipment maker and Nvidia supplier Advantest, which gained 1.82%, followed by chip-making machinery giant Tokyo Electron with a 0.9% rise. Shares of silicon processor Shin-Etsu Chemical were up 0.7%.
The best performer among the industry groups was shipping, which soared 6.81%, far outpacing second-place banking’s 1.56% advance. Shippers advanced after Nippon Yusen raised its profit forecast following the market close on Monday.
Nippon Yusen was the Nikkei’s biggest percentage gainer, rising 7.9%, followed by peer Kawasaki Kisen Kaisha, which rallied 7.3%.
While the Nikkei’s rebound is a positive sign, the market remains sensitive to global economic conditions and sector-specific developments. Given the strong performance of chipmakers and shippers, traders could focus on these sectors for short-term gains.
With the Nikkei nearing key psychological levels, traders should be cautious of potential resistance points and employ strict risk management strategies. Traders should stay informed about key economic indicators and sector performance to navigate the market effectively.
