FX168 Financial News (Asia Pacific) News Japan's Nikkei Index followed the decline in US stocks on Friday (May 24). Strong economic data previously released by the US made the market bet that the Federal Reserve might delay interest rate cuts.
The Japanese stock market opened low and fell below the 39,000 mark. By the close, the Nikkei index fell 457 points, or 1.17%, to 38,646.11 points. Earlier this week, it had fallen 0.36% from 1.9%. The TSE Index fell 0.44%. #日本市场 #
On the market, the shipbuilding, steel, gas and water sectors led the decline.
On Friday, chip stocks that had risen the day before, supported by Nvidia (Nvidia) performance, fell sharply, becoming one of the worst performing individual stocks in the Nikkei Index. Advantest fell 4.5%, Tokyo Electronics 2.8%, and Lasertec 4.5%.
In terms of fundamentals, Japan's national core consumer price index (CPI), which deducts fresh food, slowed to 2.2% year-on-year in April, up 2.6% from March, in line with market expectations.
The three major US stock indexes all fell overnight, with the Dow leading a 1.5% decline. Earlier, US manufacturers announced a series of sharp increases in raw material prices, suggesting that commodity inflation may increase in the next few months.
The benchmark US 10-year Treasury yield climbed to a high of 4.498% in more than a week because traders cut their bets and thought they might cut interest rates by 25 basis points at a time this year, while previously it was widely believed that the Federal Reserve would cut interest rates twice.
Kazuo Kamitani, a stock strategist at Nomura Securities, said that at least in the short term, the trend of Japanese stock prices is clearly in the hands of US yield levels.
Despite a sharp drop in the Nikkei index on the same day, the strategist indicated that the 25-day moving average support was held at around 38,300 points. He said that with the indicator rising slightly at the close of Friday, “the Nikkei index is likely to stay at its current level or even start rebounding from next week.”
The Nikkei Index fell 0.36% this week, but the increase since this year is still over 15%, making it one of the best performing markets in the world.
The index rose to an all-time high of 41,087.75 points on March 22, then fell back to a low of 36,733.06 points in the following month.