Japan’s Nikkei Rebounds from One-Week Low Despite Chip Drag

Reuters

12:08 JST, November 22, 2023

TOKYO (Reuters) – Japan’s Nikkei share average gained on Wednesday, rebounding from early declines even as chip shares dragged.

The Nikkei rose 0.62% to 33,560.01 as of the midday break. Of its 225 components, 184 stocks advanced, 38 fell and three traded flat.

The level puts it about halfway between the day’s low point at 33,182.99, a one-week trough, and Monday’s fresh post-1990 peak at 33,853.46.

The broader Topix rallied 0.74%.

“Japanese stocks have been stronger relative to others recently (and) a lot of people still want to buy Japanese stocks,” said Naka Matsuzawa, a strategist at Nomura Securities.

At the same time, “it’s kind of hard to draw a scenario for higher stock markets from here, because the market has already priced in quite aggressive rate cuts from the Fed,” he said.

Traders place about 29% odds on a first Federal Reserve rate cut by March, according to the CME’s Fedwatch tool.

The session’s bounce might also be amplified by technical factors, with Japanese markets closed for a national holiday on Thursday.

Online company Cyberagent led Nikkei gainers with a 4.5% jump. Uniqlo owner Fast Retailing rose 1.56%, making it the biggest points gainer due to its heavy weighting.

Paper and pulp led advances among the Tokyo Stock Exchange’s 33 industry groups, followed by Pharmaceuticals, gaining 1.89% and 1.46%, respectively.

However, chip shares were heavy amid weakness in Nvidia’s shares Chip-testing equipment maker Advantest, a Nvidia supplier, dropped 3.04% to be the biggest points decliner.