Japan markets extend gains as technology stocks rally

The Nikkei 225 rose 2.12% to close at 66,400, while the Topix gained 0.55% to 4,126 on Monday. Japanese shares advanced for the second straight session, led by technology stocks amid optimism that OpenAI?s new model could drive stronger demand for AI computing power.

Japanese technology stocks also tracked gains in US chipmakers and memory stocks. Kioxia Holdings and SoftBank Group surged 9.3% and 11.2%, respectively, while Advantest, Taiyo Yuden and Ibiden also posted strong gains.

However, gains were limited by stronger-than-expected US jobs data, which raised expectations of a Federal Reserve rate hike this month. Markets are also pricing in a possible Bank of Japan rate hike in September, as persistent inflation and a weak yen remain concerns.

Financial and consumer stocks underperformed, with Mitsubishi UFJ and Nintendo falling 2% and 1%, respectively.

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