In the morning trading on the 21st, the following three points should be noted.

While led by high technology, determine the continuation of buying into Disco.

■ Tsugami, 2Q upward revision Operating profit 9.9 billion yen ← 8 billion yen

Focus of the morning session: Futagami, new tools for aluminum cutting, exploring electric vehicle development by minimizing burrs.

While led by high technology, determine the continuation of buying into Disco.

On the 21st, the Japanese stock market is expected to have a stagnant market development after a round of buying. On the 18th, the U.S. market saw the Dow Jones Industrial Average rise by 36 points and the Nasdaq by 115 points. Amid growing number of major companies releasing earnings reports, Netflix exceeded expectations in number of subscribers and showed an optimistic outlook, leading to a significant rise, expanding buying interest in high-tech stocks. Apple received positive research feedback due to strong sales of iPhone 16 in China compared to the previous model. Nvidia was bought after an investment decision upgrade by analysts. Chicago Nikkei 225 futures settlement price was 160 yen higher than Osaka at 39,170 yen. The yen exchange rate is hovering around 150.20 yen per dollar.

The Nikkei Stock Average is expected to see buying leading the way as it adapts to Chicago futures. Netflix's earnings were factored in at the end of the previous week, but with the growing interest in high-tech stocks, it is likely to be reevaluated. Furthermore, in addition to Apple, large tech stocks such as Amazon.com and Alphabet are being bought, likely leading to an improvement in sentiment.

Furthermore, Disco <6146>, which announced its earnings last weekend, saw a significant increase and showed a breakout movement. The company has been adjusting since its peak in July, so there is a possibility that the hunt for other semiconductor stocks will expand as it continues to show solid price movements today. Also, with major companies scheduled to announce earnings this week, expectations for breakouts are likely to increase, and there is anticipation for a strengthening trend towards buy on dips.

However, there seems to be a growing trend of wanting to determine the earnings content, and the mood to carefully examine it is likely to strengthen. Therefore, the target for investment will be limited, with a focus on individual stocks with materials such as speculation based on earnings. As the earnings announcements become more prevalent, it seems to lead to daily speculations. In addition, following the earnings announcements from the previous weekend, attention is drawn to companies such as Iwai Cosmo <8707>, Aizawa Securities <8708>, Takumina <6322>, KeyH <4712>, Tsugami <6101>, and Rokkosystem <9691>.

■ Tsugami, 2Q upward revision Operating profit 9.9 billion yen ← 8 billion yen

Tsugami <6101> announced a revision to the second quarter financial estimates. Revenue was revised upward from 46.5 billion yen to 49.7 billion yen, and operating profit from 8 billion yen to 9.9 billion yen. Although there were some movements in both domestic and overseas markets, amidst the continuing uncertain market trends, they were able to maintain a strong order intake.

Materials of concern in the morning session

・ Nikkei Average is up (38,981.75, +70.56)

・ NY Dow is up (43,275.91, +36.86)

・ NASDAQ Composite Index is up (18,489.55, +115.94)

・ Chicago Nikkei Futures are up (39,170, +160 compared to Osaka)

The SOX index is rising (5208.62, +3.81).

The VIX index is decreasing (18.03, -1.08).

Long-term US interest rates fell.

Expectations for inflation to ease in the US.

Active share buybacks

Request for improvement in corporate value by the Tokyo Stock Exchange.

Futamurayekou <6474> Aluminum cutting edge new tools, exploring electric vehicles by minimizing burrs.

Alps Alpine <6770> Expanding the use of compression molding, and diversifying rubber electronic component offerings.

JFE Steel, a subsidiary of JFEHD <5411>, acquires a high-grade electromagnetic steel sheet manufacturer, advancing the business structure reorganization.

Denso <6902> considers additional investment in Rapidus with Toyota.

Mitsubishi Corporation <8058> expands partnership with a South Korean conglomerate, investing 50 billion yen in the emerging 'digital wallet' sector.

Sojitz <2768> acquires a US company specializing in electrical facilities, focusing on DC air conditioning projects.

Kawasaki Heavy <7012> collaborates with Kansai Airport Airbus on hydrogen supply to three Kansai airports.

Toyota Motor <7203>'s Daihatsu faces production stoppages for over 8 vehicle models due to delays in meeting new safety and environmental regulations.

Suzuki <7269>'s Indian subsidiary reaches a cumulative production of 10 million units at the Manesar plant.

Citizen Watch <7762>'s Citizen Machinery doubles processing capacity of cast parts at its new building in the Vietnam factory.

Takuma <6013> has won the construction contract for a waste treatment facility in Saitama's Gyoda City.

AeroEdge <7409> signs component supply contract with a major overseas aerospace manufacturer.

Shinmeiwa Kogyo <7224> develops a high-function boarding bridge with a movable cover to shield rain gutters and a telescopic mechanism.

Kikken Seisakusho <6289> accelerates overseas expansion from machinery sales to total support.

Fujitsu <6702> and Teikyo University reproduce internal body in digital space to promote lifestyle improvements with interactive experience.

Ricoh <7752> establishes a new industrial printing company in the UK to centralize sales and support.

Sanken Electric <6707> to close Shiga factory in 2026, due to the impact of the Noto earthquake.

Resonac Holdings <4004> takes a leading role in post-process semiconductor materials.

Konichi Transport <9025> participates in the community of major gas India urban gas projects.

President Hideyuki Hori of Toho Acetylene <4093> expanding applications for food, medical, and gas purposes.

Mitsubishi Chemical G <4188> increases production of polarizing plate film, establishes new facilities in Gifu.

Hagiwara Kogyo <7856> starts operation of new factory in Okayama, taking charge of the blue sheet sub-process.

☆ Schedule of events in the morning session

Not applicable.

・10:00 am Middle 1-year prime loan rate