Nikkei index closed flat amid optimism about China

Japan’s Nikkei index closed flat on Wednesday, as investors evaluated better-than-expected Chinese economic data against the prospects of further tightening monetary policy in the United States.

The Nikkei index closed up only 0.01% at 32042.25 after a volatile session during which it fell by up to 0.54% before rising 0.19% immediately before the close.

As for the broader Topix index, it closed trading at an increase of 0.14%

Among the stocks listed on the Nikkei index, 115 fell and 107 rose, while the shares of three companies saw no significant change.

Strong retail sales in the United States have raised expectations that monetary tightening will continue for a longer period, at a time when investors are already concerned about the escalating conflict in Gaza.

Kyle Rhoda, senior financial markets analyst at Capital.com, said that “markets are in a cautious mode” amid the possibility of the conflict expanding in Gaza and the possibility of the Federal Reserve (the US central bank) raising interest rates again.

However, he said that important Chinese data such as gross domestic product, retail sales, and industrial production, which exceeded expectations, “show more positive indicators of the recovery of the Chinese economy.”