Chips Boost Japan’s Nikkei Stock, but Caution Ahead of Key Central Bank Meetings Caps Gains

Reuters

12:30 JST, December 16, 2024

TOKYO (Reuters) – Japan’s Nikkei share average climbed on Monday as chip-related shares were boosted by a rise in their U.S. peers, but investors’ positioning ahead of major central bank decisions this week capped gains.

The Nikkei added 0.2% to 39,533.55 by the midday break, while the broader Topix shed 0.04% to 2,745.46.

While U.S. stocks closed the trading week near the unchanged mark in a subdued session on Friday, the Philadelphia SE Semiconductor Index surged 3.4%.

Japan’s chip-related shares tracked their peers higher to boost the Nikkei, led by chip-testing equipment maker Advantest’s 1.9% rise.

Tokyo Electron added 0.5% and Socionext rallied 9.1% to become the top percentage gainer on the benchmark.

However, moves were restrained as market players awaited what is expected to be another 25-basis-points cut by the U.S. Federal Reserve on Wednesday, followed by the Bank of Japan’s (BOJ) monetary policy decision on Thursday.

“There’s certainly a strong sense that investors are taking a wait-and-see approach,” said Hiroshi Namioka, chief strategist at T&D Asset Management.

Reuters and other media outlets reported that the BOJ is leaning toward keeping rates steady at their meeting this week.

The yen was last hovering around 153.88 per U.S$. , struggling to recover from its worst week since September on the back of those media reports.

Isuzu Motors, up 2%, was among exporter shares to gain on a softer yen, although caution weighed, with Toyota rising only 0.1% and Mitsubishi Motor sliding 1.1%.

Among other major shares, AI-focused startup investor SoftBank Group advanced 0.5% and Chugai Pharmaceutical climbed 2%.

Uniqlo brand owner Fast Retailing stumbled 0.2%, while entertainment conglomerate Sony Group slid 0.8%.