Japanese Stocks Rise, AI Boost and Iran Deal Optimism Lift Nikkei
Japanese stocks rebounded in Wednesday morning trading after indications that a US-Iran peace deal was approaching, coupled with support from Wall Street's record-breaking performance. A more positive global sentiment boosted interest in AI and semiconductor stocks, following a sharp rise in the Philadelphia Semiconductor Index and a surge in Micron Technology when US markets reopened after a holiday.
The Nikkei index rose 1.5% to 65,968.81 at around 9:22 a.m. Tokyo time, while the Topix index gained 0.4% to 3,944.92. Advantest was the largest contributor to the Nikkei, rising 5.7%. Broadly, of the 1,641 stocks, 771 rose, 802 fell, and 68 were unchanged. Both indexes briefly set new intraday records.
Daiwa Asset Management strategist Kazunori Tatebe believes the Japanese market is likely to follow the US trend, with AI and semiconductor stocks leading the movement and pushing the Nikkei to test new highs. He also believes that if the Strait of Hormuz is indeed reopened following a peace agreement, investor interest could potentially shift to sectors previously pressured by Middle East tensions.
However, risks remain. Uncertainty has not disappeared, as armed clashes have resumed in the Persian Gulf, and oil prices briefly strengthened again on Tuesday. Domestically, rising expectations for a Bank of Japan interest rate hike could make value stocks relatively more attractive, but could also curb the rally if rising yields tighten financial conditions.
Source: Newsmaker.id
