Nikkei Climbs To Three-Month Peak On Wall Street’s Lead As Softbank Jumps

Japan’s Nikkei share average surged more than 1% on Monday (March 6) to a three-month high, tracking a Wall Street rally in the previous session, after US Federal Reserve (Fed) officials calmed fears of policy overtightening.

Rate-sensitive tech shares outperformed in Japan, taking cues from their US peers last Friday, after comments from Richard Fed president Thomas Barkin that inflation is “likely past peak”, helping to rein in long-term Treasury yields from multi-month highs. A day earlier, Atlanta Fed chief Raphael Bostic hinted that a peak in rates may come in summer.

Chipmaking equipment giant Tokyo Electron jumped 3%, while Sony added 2.9%. Start-up investor SoftBank Group also jumped about 3%, buoyed by news that its subsidiary Arm Ltd aims to raise at least US$8 billion (RM35.74 billion) from a US listing.

The Nikkei opened above the key psychological 28,000 mark and probed as high as 28,288.62 for the first time since Dec 1, before entering the midday break up 1.2% at 28,259.97.

Of the Nikkei’s 225 components, 182 rose, 41 fell and two were flat.

The broader Topix gained 0.9% to 2,037.63.

Further gains for Japanese stocks could be hard with Fed chair Jerome Powell giving testimony to Congress on Tuesday and Wednesday, followed by Bank of Japan governor Haruhiko Kuroda’s final policy meeting running the following two days.

The pivotal US non-farm payrolls report is also due on Friday, which will be the final day for Fed speak before the black out period going into a policy meeting on March 22.

“Although I’m sure the Nikkei will stay up throughout the day, the topside must be starting to get heavy considering we also had a more than 400-point rally on Friday,” said Maki Sawada, a strategist at Nomura Securities.

“The recovery to back above 28,000 happened really suddenly.”

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