In the afternoon trading on the 20th, we want to focus on the following three points.

- The Nikkei average continued to rise for the third day, as it viewed the rise in US stocks as a positive development.

- The USD/JPY remained steady as the Bank of Japan maintained its current policy.

- First Retailing Co., Ltd. <9983> was the top contributor to the price increase, followed by Tokyo Electron Ltd. <8035>.

- The Nikkei average continued to rise for the third day, as it viewed the rise in US stocks as a positive development.

The Nikkei Average continued to rise significantly for the third consecutive day. It closed the morning session at 37,935.58 yen (+780.25 yen or +2.10%) with an approximate trading volume of 0.8 billion shares.

The U.S. stock market rebounded significantly on the 19th. The Dow Jones Industrial Average closed at 42,025.19 yen, up 522.09 dollars or 1.26%, the Nasdaq closed at 18,013.98, up 440.68 points or 2.51%, and the S&P500 closed at 5,713.64, up 95.38 points or 1.70%. Weekly initial jobless claims reached a 4-month low, easing concerns about labor market slowdown, leading to an increase in market opening. In addition, expectations of a significant interest rate cut by the Federal Open Market Committee (FOMC) contributed to the belief that the economy will experience a soft landing without a sharp decline, further fueling the rise. The technology sector also provided strong support to the market, leading to an expanded gain in the latter half of the session.

The Tokyo market started trading with a buying bias following the significant rebound in U.S. stocks. Semiconductor stocks such as Tokyo Electron (<8035>) stood out due to the rise in U.S. high-tech stocks, and the Nikkei Average started at around 37,700 yen and expanded its gain until just before 38,000 yen. It ended the morning session above the 25-day moving average (around 37,450 yen level) and the 200-day moving average (around 37,620 yen level).

Among the stocks selected for the Nikkei Average, many semiconductor stocks such as Tokyo Electron, Socionext (<6526>), Laser Tech (<6920>), and Renesas Electronics (<6723>) were bought. Furthermore, Resonac Holdings (<4004>) was bought after announcing a price increase for graphite electrodes, and speculative buying was directed towards Tokai Carbon (<5301>). In addition, Kawasaki Heavy Industries (<7012>), Murata Manufacturing (<6981>), Taiyo Yuden (<6976>), Furukawa Electric (<5801>), SUMCO (<3436>), and Dentsu Group (<4324>) also rose.

On the other hand, private railway stocks such as Keisei Electric Railway (<9009>), Odakyu Electric Railway (<9007>), and Tobu Railway (<9001>) were generally weak, and retail-related stocks such as Aeon (<8267>), Marui Group (<8252>), and J. Front Retailing (<3086>) were also low. In addition, ZOZO (<3092>), Sumitomo Dainippon Pharma (<4506>), and Kyowa Kirin (<4151>) declined.

In terms of industry sectors, petroleum and coal products, electrical equipment, nonferrous metals, glass and stone products, and banking industry all rose, while land transportation industry and electric and gas industry were the only two sectors that declined.

During lunchtime, the exchange rate is hovering around 142.50 yen per dollar. At 11:40 a.m., the outcome of the Bank of Japan's monetary policy meeting currently taking place has not been conveyed, but the market consensus is to expect a 'maintenance of the current monetary policy', so after the announcement, the movements in the foreign exchange and stock markets are expected to be limited. Market attention is shifting towards the press conference by BoJ Governor Haruhiko Kuroda starting at 3:30 p.m., and there are no significant movements expected in the afternoon session of the Tokyo market. The Nikkei average is likely to remain in a consolidation phase at high levels.

Dollar-yen remains steady, while the Bank of Japan maintains the current policy.

In the morning of the 20th, the Tokyo market saw the dollar-yen rate holding steady. It rose to 142.93 yen in the morning, but due to the rising inflation pressure in Japan, it fell to 142.14 yen due to yen buying. However, the Bank of Japan decided to maintain the current policy at its monetary policy meeting, leading to a retreat in expectations of additional rate hikes and a decline in yen buying.

The trading ranges so far are as follows: Dollar-yen from 142.14 yen to 142.93 yen, Euro-yen from 158.67 yen to 159.49 yen, and Euro-dollar from 1.1157 dollars to 1.1163 dollars.

Check stocks for the afternoon session

- Precision System Science Co., Ltd. <7707> saw one stock hit the daily limit.

*Includes temporary stopper (indicated price)

- First Retailing Co., Ltd. <9983> was the top contributor to the price increase, followed by Tokyo Electron Ltd. <8035>.

Economic indicators and remarks by important people

[Economic indicators]

- On Sunday, August, the nationwide consumer price index (excluding fresh food) was +2.8% YoY (Forecast: +2.8%, July: +2.7%).

[Important Person's Remarks]

-Minister of Finance Suzuki

The impact of the market due to the Fed rate cut cannot be simply stated.

Bank of Japan concludes its financial policy meeting.

- 3:30 pm: Mr. Ueda, Governor of the Bank of Japan, will hold a press conference.

- 3:00 pm UK - August retail revenue (including automotive fuel) (Expected change from previous month: +0.4%, July: +0.5%)