TOKYO: Japan’s Nikkei share average rose on Tuesday, underpinned by overnight strong finish on Wall Street, while investors await the outcome of the US Federal Reserve’s two-day meeting to determine the fate of the yen.
The Nikkei rose 1.24% to close at 38,405.66. The index marked its first monthly decline this year, falling 4.99% in April in its biggest monthly drop since December 2022. The broader Topix jumped 2.2% to 2,743.17.
“The US equities were strong since the end of the last week, while the US yields traded lower. That underpinned Japanese stocks today,” Shoji Hosoi, senior strategist, Daiwa Securities said. Markets in Japan were closed on Monday.
Shares of chip-making equipment maker Tokyo Electron rose 2.6%. Silicon-wafer maker Shin-Etsu Chemical surged 4.89% and technology investor SoftBank Group gained 1.71%. The markets’ focus is now on the US Fed’s policy meeting this week after Japan’s currency surged as much as 5 yen against the dollar from a 34-year low of 160.245 on Monday in what traders cited as intervention.
“Whether or not what the market thought was an intervention yesterday was a success is not known. Because the yen could spike 160 to the dollar again if the Fed’s message is hawkish after its meeting,” Daiwa’s Hosoi said.
Japanese authorities have not confirmed that they had stepped into the currency market in support of the yen.
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