Monday, 11 December 2023

Japan’s Nikkei rebounds from worst week of 2023 after clearing BOJ, Fed tests


Japan’s Nikkei share average rebounded sharply on Monday, as investors bought back beaten-down stocks after major risk events, including meetings of the U.S. Federal Reserve and the Bank of Japan, concluded, Reuters reported.

The Nikkei climbed 0.58% to 32,590.33 as of the midday recess. The broader Topix rose 0.27%.

Last week, the Nikkei declined every day in a holiday-shortened week to tumble a 3.37%, its worst performance this year.

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The spring back from that is “a big factor” in the Nikkei’s Monday rally, said Maki Sawada, a strategist at Nomura Securities.

In addition, “the big central bank events of last week passed without major market ructions, so there’s a sense of relief that should support the Nikkei throughout the day”, she said.

The Nikkei dipped to a one-month low of 32,154.53 on Friday, sharply dropping from a 2-1/2-month peak at 33,428.44 a week earlier.

Japan’s finance ministry data on Friday showed overseas investors – a major driver of Nikkei gains this year – sold into that rally, shedding a net 1,583.9 billion yen ($10.68 billion) worth of Japanese equities in the week to Sept. 16, the most since March 2019.

On Monday, healthcare was the top performing sector , jumping 2.61%, lifted by a 7.66% surge for the Nikkei’s top performing stock, Daiichi Sankyo.

The drugmaker is jointly developing a breast cancer drug with AstraZeneca, which said late last week the experimental treatment slowed progression of the disease in a late-stage trial.

Tech shares rebounded, tracking gains for U.S. peers from Friday. Chip-testing equipment maker Advantest rallied 3.43%, while startup investor SoftBank Group advanced 2.61%.

However, stocks that had outperformed last week were offloaded, with banks shedding 2.38% and shippers down 1.61%. The top five Nikkei decliners were all lenders, led by a 3.16% slide for Chiba Bank. ($1 = 148.3600 yen)