Japan’s Nikkei Pares Weekly Loss on Lower US Yields, Softer Yen

Reuters

16:35 JST, May 23, 2025

TOKYO (Reuters) — Japan’s Nikkei share average rallied on Friday, supported by falling U.S. Treasury yields and a weaker yen, but still lost ground for the week.

The gauge closed up 0.5%, trimming its five-day slide to 1.6%, the first weekly decline in more than a month.

The broader Topix climbed 0.7% to 2,739.13, but closed the week 0.9% lower.

Rises in U.S. Treasury yields have paused and that buoyed appetite for Japanese stocks, said Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory.

But for the index to rise higher next week and beyond, it needs some new catalysts, he said.

U.S. Treasury yields fell overnight after a recent selloff drew some buyers at more attractive levels, with 30-year yields reaching the highest in 19 months earlier in the session.

The U.S. dollar rebounded after recent losses, pushing the yen down 0.4% to 143.47, after it had briefly strengthened to 142.8 overnight.

A weaker Japanese currency tends to boost shares of exporters, as it increases the value of overseas profits in yen terms when firms repatriate them to Japan.

The Nikkei has fully recovered its losses since U.S. President Donald Trump’s April 2 tariff announcement, climbing 25% from its April 7 low to a peak on May 13.

Investors turned cautious about the sharp gains and sold stocks, but they bought stocks today as they were relieved to see the peak of the Nikkei, said Takuro Hayashi, head of the investment research department at IwaiCosmo Securities.

Among individual stocks, Uniqlo-brand owner Fast Retailingrose 0.9%. Chip-related Tokyo Electron and Advantest gained 0.3% and 0.5%, respectively.

All but seven of Tokyo Stock Exchange’s 33 industry sub-indexes rose, with the nonferrous metals sector jumping 3.5% to become the top performer.

Cable makers, a gauge for AI investments, advanced, with Fujikura and Furukawa Electric up 4.9% and 4.5%, respectively.