{"id":15076,"date":"2024-09-20T10:03:24","date_gmt":"2024-09-20T10:03:24","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=15076"},"modified":"2024-09-20T10:03:24","modified_gmt":"2024-09-20T10:03:24","slug":"japans-nikkei-posts-best-week-since-mid-august-but-yen-strength-caps-gains","status":"publish","type":"post","link":"https:\/\/www.global-vtrader.com\/en\/analysis\/japans-nikkei-posts-best-week-since-mid-august-but-yen-strength-caps-gains\/","title":{"rendered":"Japan&#8217;s Nikkei posts best week since mid-August, but yen strength caps gains"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><strong>Key points:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Nikkei index climbed 1.53% to 37,723.91, with a weekly gain of 1.57%.<\/li>\n\n\n\n<li>The yen strengthened by 0.45% against the US dollar, dampening export sector performance.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p class=\"wp-block-paragraph\">The Nikkei index surged by as much as 2.21% during early trading on Friday before paring gains later in the day, closing 1.53% higher at 37,723.91. This marks its best weekly performance in over a month, with a weekly rise of 1.57%. <\/p>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/wp-content\/uploads\/2024\/09\/20240920-175615-1024x473.jpg\" alt=\"On the Nikkei 225 hourly chart at vtmarkets.com, the price has been trending higher, with a clear upward trajectory supported by the moving averages (5, 10, 30), which show a bullish alignment. The MACD is also in positive territory, further confirming the strong momentum in the market.\" class=\"wp-image-15077\" style=\"width:1450px;height:auto\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center wp-block-paragraph\"><em>See: Japan\u2019s Nikkei surged, trading at 38177.85 on the <a href=\"https:\/\/vtmarketsapp.onelink.me\/CD7D\/240525WA\">VT Markets app<\/a>.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Nikkei 225 saw a strong rally, closing at 38,170.15, driven by gains in the chip sector. Tokyo Electron, a major manufacturer of chip-making equipment, surged by 5.32%, helping to boost the overall index. The index crossed the 38,000 level, reflecting positive sentiment from the broader US tech market, which has seen a similar upward trend.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">On the hourly chart, the price has been trending higher, with a clear upward trajectory supported by the moving averages (5, 10, 30), which show a bullish alignment. The MACD is in positive territory, further confirming the strong momentum in the market.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">If the current trend continues, we could see the Nikkei 225 testing the 38,500 level as the next potential resistance. On the downside, 37,600 is the immediate support, with further pullbacks possibly targeting the 37,200 region. <\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\"><strong>Topix rises, but yen strength limits market optimism<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The Topix index also reflected a positive week, advancing by 0.97%. However, the strength of the yen, which rose by 0.45% to 141.98 against the dollar, curbed the enthusiasm of market participants. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This yen appreciation came after the Bank of Japan (BOJ) released its updated assessment of the economy, which took a more optimistic view of consumption. <a href=\"https:\/\/x.com\/The_Japan_News\/status\/1836967498358345875\">The BOJ held its short-term interest rates steady at 0.25%<\/a>, as widely expected, following its rate hikes earlier in the year.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">BOJ Keeps Interest Rates Steady, Sticks to Upbeat Economic View <a href=\"https:\/\/t.co\/5THfx6dR1j\">https:\/\/t.co\/5THfx6dR1j<\/a> <a href=\"https:\/\/t.co\/KsBUa9qIy3\">pic.twitter.com\/KsBUa9qIy3<\/a><\/p>&mdash; The Japan News (@The_Japan_News) <a href=\"https:\/\/twitter.com\/The_Japan_News\/status\/1836967498358345875?ref_src=twsrc%5Etfw\">September 20, 2024<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\"><strong>BOJ\u2019s upgrade hints at rate hikes, yen strength challenges exporters<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The market reacted to the BOJ\u2019s upgraded outlook, which now sees private consumption on a &#8220;moderate increasing trend&#8221; rather than just &#8220;resilient.&#8221; <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This shift signalled that the central bank could be setting the stage for future rate hikes, which traders will watch closely as the yen\u2019s strength could continue to challenge Japanese exporters. A <a href=\"https:\/\/www.vtmarkets.com\/analysis\/dollar-yen-pair-under-scrutiny-as-traders-eye-central-bank-moves\/\">stronger yen<\/a> reduces the value of overseas revenue for companies like Toyota and Honda, which saw more modest gains on Friday, rising 0.9% and 0.84%, respectively.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Shares of Fast Retailing, the owner of Uniqlo, rose by 4.16%, making it one of the biggest supports for the Nikkei in points terms due to its heavy index weighting. Despite these gains, many market participants remained cautious ahead of a long weekend, as Japan\u2019s markets will be closed on Monday for a national holiday.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>You might be interested: <a href=\"https:\/\/www.vtmarkets.com\/blog\/research\/fomc-heres-why-wed-love-to-see-the-fed-cut-by-50-basis-points-in-september\/\">Here\u2019s why we\u2019d love to see the Fed cut by 50 basis points in September<\/a><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We expect that yen strength will continue to weigh on Japan\u2019s export-heavy sectors, while the prospect of gradual BOJ rate hikes could bring further adjustments to market expectations. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Traders will also monitor global economic factors, particularly from the US, which may influence the tech-driven momentum seen this week.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Start trading now \u2014 click <\/strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/?utm_campaign=account_c&amp;utm_source=dma&amp;utm_medium=website\"><strong>here<\/strong><\/a><strong> to create your live VT Markets account.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Nikkei index surged by as much as 2.21% during early trading on Friday before paring gains later in the day, closing 1.53% higher at 37,723.91. This marks its best weekly performance in over a month, with a weekly rise of 1.57%. -vtmarkets.com<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[27],"tags":[31,33,30],"class_list":["post-15076","post","type-post","status-publish","format-standard","hentry","category-analysis","tag-indices","tag-stocks","tag-yen"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15076","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/comments?post=15076"}],"version-history":[{"count":0,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15076\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/media?parent=15076"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/categories?post=15076"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/tags?post=15076"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}