Japan’s Nikkei Stock Average Gains despite US Tariff Threats; Banks Rally on Upbeat GDP (UPDATE 1)

Reuters

12:30 JST, February 17, 2025

TOKYO, Feb 17 (Reuters) – Japan’s Nikkei share average gained in choppy trade on Monday, boosted by financials as the economy grew more than expected, while automakers dragged on threats of U.S. tariffs aimed at imported cars.

The Nikkei added 0.1% to close at 39,174.25 after seesawing between gains and losses for much of the session. The broader Topix climbed 0.3% to 2,766.9.

Rate-sensitive banks gained 0.9% and shorter-term Japanese government bond yields marched higher after data showed Japan’s economy expanded an annualized 2.8% in the October-December quarter.

The latest Gross Domestic Product (GDP) figures appeared to support the Bank of Japan’s plan to keep hiking interest rates and normalize monetary policy.

Megabanks Sumitomo Mitsui Financial Group and Mitsubishi UFJ Financial Group both added about 2%.

Investors sized up the latest tariff salvo after U.S. President Donald Trump said on Friday that tariffs on automobiles would be coming as soon as April 2, without any further details.

“There are a lot of uncertainties…, leaving just a vague impression that tariffs will be increased,” said Kazuo Kamitani, an equities strategist at Nomura Securities.

Toyota Motor, down 1.1%, was among major automakers to decline. The auto sector shed 1.3% to become one of the worst performers among the Tokyo Stock Exchange’s 33 industry sectors.

Wall Street offered Japanese shares little direction, with U.S. stocks ending mixed on Friday. AI darling Nvidia climbed to lift the Nasdaq, while the Dow and S&P 500 declined.

U.S. markets will be closed on Monday for the Presidents’Day holiday.

Among Japan’s heavyweight shares, chip-testing equipment maker Advantest, which counts Nvidia among its customers, gained 1.3%, while AI-focused startup investor SoftBank added 1.8% to boost the Nikkei the most.

Peer Tokyo Electron stumbled 1.1%, while Sony Group rallied 4.1%.

Bridgestone surged to end nearly 6% higher as the tiremaker announced plans to buy back up to 11% of its shares.