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This is a follow up article to: Nikkei Hits 3-Week High on Wall Street Gains and BOJ Dovishness
The Japanese stock market index Nikkei 225 (Symbol: Nikkei225) saw modest gains on Friday, primarily driven by the rally in semiconductor-related shares following a strong performance on Wall Street.
Traders took cues from the overnight surge in U.S. tech stocks, particularly memory chipmaker Micron Technology, which beat revenue expectations, benefiting AI-driven demand.
Picture: Nikkei225 price rises on tech gains, as observed on the VT Markets app.
This positive momentum flowed into the Asian markets, lifting Tokyo Electron and Lasertec by 4.2% and 5.1%, respectively.
However, broader market gains were capped as attention shifted to the Liberal Democratic Party leadership election in Japan, set to determine the successor to Prime Minister Fumio Kishida.
While stocks like Fanuc and Yaskawa Electric gained ground on hopes of continued Chinese stimulus, caution prevailed ahead of the election outcome. Investors are especially focused on candidate Sanae Takaichi, whose policies mirror the late Shinzo Abe’s pro-stimulus approach.
With the leadership election outcome yet to be determined, market participants await clarity on the future of the Japanese economic policies, particularly regarding monetary easing and fiscal stimulus.
For short-term traders, opportunities lie in tech-related shares like Tokyo Electron and Lasertec, which have shown strong gains. Additionally, Chinese stimulus measures could support stocks like Fanuc and Yaskawa Electric, which are closely tied to China’s economic health.
Cautious traders may want to monitor the broader market as uncertainties surrounding Japan’s leadership race and the potential for policy shifts could introduce volatility, warranty risk management measures in trade planning and execution.
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