TOKYO – Tokyo stocks closed at all-time highs for a second straight trading day on Thursday as heavyweight technology shares drew buying amid hopes for growth on the back of artificial intelligence demand.
The 225-issue Nikkei Stock Average gained 534.83 points, or 1.22 percent, from Wednesday to 44,372.50, while the broader Topix index finished 6.79 points, or 0.22 percent, higher at 3,147.76, both record closes.
On the top-tier Prime Market, the main gainers were information and communication, nonferrous metal and mining issues.
The U.S. dollar mostly moved narrowly in the lower 147 yen range in Tokyo for most of the day due to few new trading incentives. Investors were awaiting the release of U.S. consumer price index data for August later in the day, dealers said.
At 5 p.m., the dollar fetched 147.77-78 yen compared with 147.42-52 yen in New York and 147.50-51 yen in Tokyo at 5 p.m. Wednesday.
The euro was quoted at $1.1693-1694 and 172.79-83 yen against $1.1690-1700 and 172.38-48 yen in New York and $1.1701-1703 and 172.60-64 yen in Tokyo late Wednesday afternoon.
The yield on the benchmark 10-year Japanese government bond ended at 1.575 percent, up 0.010 percentage point from Wednesday’s close, as the debt sold on rises in Tokyo stocks.
Active buying of tech stocks was triggered by record closes of both the U.S. Nasdaq and S&P 500 indexes overnight, boosted by a 36 percent surge in U.S. software company Oracle on its upbeat business outlook, brokers said.
However, some investors were cautious over chasing the upside as they see the recent record closes as a sign of the Tokyo stock market being overheated, broker said.
Among tech issues, semiconductor-related issues and AI-related stocks, such as SoftBank Group and Advantest rose sharply in particular. SoftBank Group soared 10 percent to 17,905 yen, while Advantest ended up 4.4 percent to 13,700 yen.
Meanwhile, expectations that the U.S. Federal Reserve will cut interest rates grew stronger as a lower-than-expected U.S. producer price index for August released on Wednesday indicated slowing inflation.
“The market is factoring in the scenario of rate cuts up to three times within this year amid growing expectations,” said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co.
“Technology shares were being bought on (expectation for) lower U.S. interest rates and the view that a slowdown in the world’s largest economy can be avoided” helped by rate cuts, Ichikawa added.
AloJapan.com