Nikkei index closed up 1.13%, tracking Wall Street’s gains

Japan’s Nikkei index rose on Monday, tracking Wall Street’s gains, after an inflation report in the United States supported expectations of a cut in interest rates in the world’s largest economy this year.

According to CNBC, the Nikkei index closed 1.13% higher at 38,923.03 points, after reaching the morally important level of 39,000 points earlier in the session.

The broader Topix index closed 0.92% higher at 2,798.07 points.

Sentiment improved as the market reacted to the data of the personal consumption expenditures price index in the United States, which was released on Friday. The data showed that the index rose 0.3% last month, in line with expectations, which strengthened expectations that the US Federal Reserve would reduce interest rates this year.

The Dow Jones and Standard & Poor’s 500 indices ended trading on Friday with a rise, which enhanced the feeling of relief during trading operations on the Tokyo Stock Exchange and supported widespread gains for Japanese stocks.

Of the 225 stocks on the Nikkei index, 185 rose and 40 declined.

The financial sector index, which tends to benefit from higher interest rates, rose on Monday, with shares of insurance companies rising 3.1% and securities companies rising 3.8%, recording the best performance among 33 sub-indices on the Tokyo Stock Exchange.

Among individual stocks, Daiwa Securities Group shares jumped 5.6% and Nomura Holdings shares jumped 4%.

Tokyo Electron chip manufacturing equipment company shares increased 1.7%, and Fast Retailing shares increased 1.8%.

Shares of a number of car manufacturers fell after the Japanese Ministry of Transport said that violations had been detected by five major car companies. Mazda Motor and Toyota Motor shares recorded the largest losses, at 3.3% and 1.8%, respectively.