Japanese equities rally on AI and rate-cut hopes

Japanese equity markets closed sharply higher on Monday, with the Nikkei 225 rising 2.08% and the broader Topix index gaining 0.63%. Market sentiment was supported by gains on Wall Street after weaker-than-expected US employment data reduced concerns about a near-term interest rate hike by the US Federal Reserve.

Investors also continued to monitor geopolitical developments in the Middle East. While the US indicated that a potential agreement with Iran could be close, Iran denied reports of direct negotiations, keeping geopolitical uncertainty in focus.

On the domestic front, Japan's current account surplus narrowed in June. Strong exports of AI-related electronic products were offset by higher imports, particularly crude oil purchases, resulting in a smaller surplus compared to previous months.

Technology and AI-linked stocks led the market higher, reflecting continued investor optimism toward the semiconductor and artificial intelligence sectors. Shares of Fujikura, Advantest, Tokyo Electron, Furukawa Electric and Ibiden recorded strong gains during the session. Consumer-focused stocks also performed well, while financial stocks lagged the broader market and ended lower.

Powered by Capital Market - Live News