Japanese Shares Track Wall Street Higher

The Nikkei 225 Index rose 0.4% to above 64,500 while the broader Topix Index climbed 1.2% to 4,130 on Thursday, recouping some losses from the previous session and tracking gains on Wall Street overnight as a pullback in global bond yields provided some relief. Oil prices also halted their rally after President Donald Trump said the latest attacks on Iran would be short-lived, easing inflation concerns. Meanwhile, traders kept a close watch on the yen after it rallied sharply amid speculation of a rate check and possible intervention by authorities. A stronger yen weighs on the earnings outlook for Japan’s export-heavy industries and makes domestic assets more expensive for foreign investors. Financial stocks led the rebound, with notable gains from Mitsubishi UFJ (2.6%), Sumitomo Mitsui (2.7%) and Mizuho Financial (2.3%).

The Nikkei 225 Index fell 0.2% to around 64,200 while the broader Topix Index gained 0.7% to 4,110 in mixed trade on Thursday, with Japanese shares lacking clear direction as the yen suddenly strengthened amid speculation that authorities had conducted a rate check. A stronger yen weighs on the earnings outlook for Japan’s export-heavy industries and makes domestic assets more expensive for foreign investors. Meanwhile, equities found some support from a pullback in oil prices after President Donald Trump said the latest attacks on Iran would be short-lived. Global bond yields also retreated from recent highs as investors continued to assess the inflation and interest rate outlook. Among individual stocks, notable losses were recorded in tech firms such as Advantest (-1.6%), Fujikura (-1.2%) and Taiyo Yuden (-1.3%), while financial stocks gained, including Mitsubishi UFJ (1.5%), Sumitomo Mitsui (2.1%) and Mizuho Financial (1.5%).

The Nikkei 225 Index dropped 2.85% to close at 64,325 on Wednesday, hitting four-week lows as surging global bond yields and oil prices weighed heavily on equities. Oil prices climbed for a third consecutive session amid escalating hostilities between the US and Iran, heightening inflationary risks and pushing global bond yields higher. Japan’s 10-year government bond yield reached 3% for the first time since 1996, also supported by growing expectations for a Bank of Japan interest rate hike. Governor Kazuo Ueda said this week that policymakers need to pay greater attention to upside price risks when conducting monetary policy, signaling that a rate increase is likely later this month. Tech and AI-related stocks led the decline, with notable losses from Advantest (-2.5%), Fujikura (-3.9%), Taiyo Yuden (-4.6%), Tokyo Electron (-3.4%) and SoftBank Group (-6.4%). Financial, consumer and industrial stocks also recorded sharp declines.