In the morning session on the 25th, the following three points should be noted.
There is a possibility that the adjustment will end with a break of 38,000 yen.
Orbic's Q1 operating profit increased by 7.0% to JPY 18.6 billion, and the stock split the shares from 1 to 5.
Key topics in the morning: TOYO ENGINEERING is considering manufacturing e-methanol in India.
There is a possibility that the adjustment will end with a break of 38,000 yen.
On the 25th, the Japanese stock market is expected to start with a sell-off due to the drop in US stocks, and then search for resilience after one round of selling. On the 24th, the US market fell sharply, with the Dow Jones Industrial Average down 504 dollars and the Nasdaq down 654 points. As Tesla and Alphabet reported earnings after the previous day's trading ended and plummeted, other high-tech stocks followed suit. Selling pressure prevailed amid weak sales of new homes and growing concerns about the economy. The Chicago Nikkei 225 futures settlement price is 38,115 yen, 1005 yen lower than Osaka. The dollar-yen rate is hovering around 153.60 yen per dollar.
The futures market is expected to start with a sell-off, with selling pressure expected to increase due to selling in high-tech stocks such as Microsoft and semiconductors such as NVIDIA, in addition to Tesla and Alphabet, which have already fallen after-hours the previous day. Due to the effect of arbitrage unwinding selling, a downward trend overshooting is likely.
Moreover, the appreciation of the yen to around 153 yen per dollar in the foreign exchange market is also a burden. Lowering interest rates is expected at the Federal Open Market Committee (FOMC) in the coming week due to weak economic indicators in the United States. While the Bank of Japan is expected to maintain the status quo at its monetary policy meeting, a reduction in the interest rate differential between Japan and the United States due to expectations of policy normalization may also be a concern, and the compression of positions aimed at interest rate differentials is also a concern.
The Nikkei average has fallen to the 75-day moving average, which is considered a support level, due to adjustments to the previous day. Since the Nikkei 225 futures fell as low as 38,090 yen in the night session, the Nikkei average is likely to fall below the 75-day moving average and focus on around 37,950 yen, which is the recent low on June 17th. Since the -2 σ of the Bollinger Bands is located around 38,033 yen, there is a possibility that a break of 38,000 yen will lead to the end of the adjustment.
However, there is limited movement to actively rebound as earnings announcements are intensifying and we are approaching next week's Japanese and US monetary policy meetings. Among the moves to find the bottom, it will be a search for individual stocks based on earnings announcements.
Orbic's Q1 operating profit increased by 7.0% to JPY 18.6 billion, and the stock split the shares from 1 to 5.
Orbic's Q1 operating profit increased by 7.0% to JPY 18.6 billion, and the stock split the shares from 1 to 5.
Materials of concern in the morning session
Crude oil futures rose (77.59, +0.63).
Expectations for inflation to ease in the US.
Request for improvement in corporate value by the Tokyo Stock Exchange.
Murata Manufacturing is promoting decarbonization of supply chains by sea transport of electronic components.
Seven companies, including KDDI, have joined the Privacy Tech Association established by JMDC.
NRI will collaborate with three companies, including ELYZA, to provide corporate AI solution.
Isuzu Motors plans to introduce a truck that can be driven with a regular license to expand the range of drivers.
Toyota Boshoku, a subsidiary of Toyota Motor Corp, has achieved 100% renewable energy in all 12 domestic factories.
Miura Industries has changed the specifications of its gas boiler to allow for mixed combustion using hydrogen.
Toyoe Engineering <6330> plans to produce e-methanol in India.
Furukawa Electric <5801> establishes new factories in Japan and the Philippines for manufacturing DC water-cooled modules.
Hitachi <6501> receives large-scale elevator orders for 450 units for high-rise residences in Singapore.
NTT <9432> analyzes esports and predicts fighting game results using brain waves.
Asteria <3853> delivers no-code development tool to JA for apple shipping management support.
Hirose Electric <6806> releases board-to-board connector with heat resistance of up to 125 °C for automobiles.
Panasonic HD <6752> develops nickel processing technology for Panasonic Energy in Australia.
Nomura Real Estate HD <3231> verifies the effects of logistics automation equipment in virtual space.
Mitsubishi Chemical G <4188> to raise the price of MMA monomer next month.
Unitika <3103> reduces CO2 emissions by 20% during manufacturing process of fire-resistant curtain wall sheets.
Mitsui Fudosan <8801> establishes logistics facilities in the UK, scheduled for completion in 2026, with a focus on environmental considerations.
☆ Schedule of events in the morning session
Monthly Economic Report by the Japanese government for July.
Not applicable.