- Wednesday, October 16, 2024
Tokyo’s Nikkei 225 Surges
Japan’s main stock market index, Tokyo’s Nikkei 225, closed up 1.9% on Friday, reaching near the 40,000 level. The index hit a session high of 39,990.23, surpassing the record set just days ago. Tech names such as Tokyo Electron, Trend Micro, and Advantest contributed to the boost, following a rally in the U.S. sector.
Market Insights and Analysis
According to Richard Hunter, head of markets at Interactive Investor, overseas buying interest has supported share prices in Japan. Despite a decline in manufacturing activity, marked by a PMI reading of 47.2 in February, the weaker yen has bolstered prospects for exporters. The latest data also shows a drop in Japan’s unemployment rate to 2.4% in January.
Mixed Data in China Markets
On the other hand, China stocks witnessed growth despite mixed economic data. Hong Kong’s Hang Seng rose by 0.8% while the Shanghai Composite index added 0.3%. The PMI reading for manufacturing activity remains below 50, indicating a contraction compared to the previous month.
Overall, the Asian markets continue to show resilience and promise amidst global economic challenges.
China's Manufacturing Sector Shows Mixed Signals
According to the National Bureau of Statistics, China's manufacturing activity marked its fifth consecutive month of contraction in February with a reading of 49.1. However, the unofficial Caixin PMI painted a more positive picture by showing that the manufacturing sector expanded for a fourth straight month.
Anticipation for Economic Policies at China's National People's Congress
Investors are eagerly awaiting policies aimed at revitalizing the economy, which are expected to be announced during China's upcoming National People's Congress next week. This event will also see Beijing revealing its annual GDP growth target.
Market Updates
- Korea: The market is closed for a holiday.
- Australia: The S&P/ASX 200 AU:XJO rose by 0.6% to 7,745.60.
- Bangkok: The SET TH:SET experienced a slight uptick of 0.1%.
Positive Momentum in the U.S. Markets
On Thursday, Wall Street witnessed positive gains:
- The S&P 500 SPX climbed by 0.5% to reach 5,096.27, surpassing a record set the previous week.
- The Nasdaq Composite COMP outperformed with a 0.9% gain, reaching 38,996.39 and breaking its all-time high established in 2021.
- The Dow Jones Industrial Average DJIA finished just below its record high after rising by 0.1% to 38,996.39.
Bond Market Reactions
Following a closely monitored inflation report revealing expected price increases across the country last month, bond yields saw a decrease. This has fueled hopes that the Federal Reserve might kickstart interest rate cuts as early as June to alleviate economic pressures and bolster investment prices. The Fed has hinted at the possibility of multiple rate cuts throughout the year.
Shifts in Market Expectations
Recent strong economic reports have prompted traders to revise their forecasts regarding potential Fed rate cuts. Expectations have shifted from March, with speculation now pointing towards a delay in the rate-cutting timeline.
Currency Updates
- The U.S. dollar strengthened against the Japanese yen, rising to 150.64 from 149.98.
- The euro also saw a slight increase, climbing to $1.0817 from $1.0803.
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