Japan’s Nikkei Stock Average Ends Higher as Chip-Related Shares Track Nasdaq Gains (UPDATE 1)

Reuters

12:29 JST, November 19, 2024 (updated at 16:45 JST)

TOKYO (Reuters) – Japan’s Nikkei share average closed higher on Tuesday, driven by chip-related stocks which tracked overnight gains in the Nasdaq, while investors awaited Nvidia’s quarterly earnings.

The Nikkei rose 0.51% to 38,414.43, while the broader Topix climbed 0.68% to 2,710.03.

“Some of Japan’s chip-related stocks rose after the U.S. semiconductor chip index snapped six straight sessions of losses overnight,” said Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory.

“Some chip shares also fell as market participants stayed away from active bets ahead of Nvidia’s earnings.”

The Nasdaq and S&P 500 closed higher on Monday, recovering some losses as investors anticipate quarterly earnings from Nvidia.

Nvidia will report its third-quarter earnings on Wednesday, which investors will parse to assess demand for chips and the sustainability of the AI euphoria that has driven much of the market’s rally this year.

Chip-testing equipment maker Advantest jumped 3.7% and was the biggest boost to the Nikkei. Semiconductor silicon wafer maker Shin-Etsu Chemical rose 1.12%.

Lasertec fell 1.75%, while Tokyo Electron erased early losses to end 0.25% higher.

Banking shares rose on expectation the Bank of Japan would hike rates as soon as next month. The banking index gained 2%, with Sumitomo Mitsui Financial Group and Mizuho Financial Group climbing 3.32% and 2.49%, respectively.

Automakers rose 1.73%, with Toyota Motor and Honda Motor gaining 2.04% and 2.42%, respectively, amid the overall trend of a weaker yen.

Shares of Kadokawa surged 23% to the daily limit after Reuters reported Sony is in talks to acquire the media powerhouse behind the “Elden Ring” game, while Sony ended 0.63% higher.

Overall, investors remained cautious as they wanted to see the impact of policy changes from the incoming Donald Trump administration on Japanese exporters, Yasuda said.

Staffing agency Recruit Holdings fell 2.93% to weigh on the Nikkei the most. (Reporting by Junko Fujita; Editing by Subhranshu Sahu and Varun H K)