TOKYO: Japan’s Nikkei share average rose on Wednesday as investors weighed news that Japan’s prime minister will step down later this year, while they positioned themselves ahead of US inflation data.
The Nikkei finished up 0.6% at 36,442.43 to secure its third consecutive day of gains, while the broader Topix closed 1.1% higher at 2,581.90.
The Nikkei initially rallied more than 1% after local media reported Japanese Prime Minister Fumio Kishida will step down as ruling party leader in September, which he later confirmed in a televised press conference.
Analysts said although the prime minister’s decision to step down could add some uncertainty, the impact should be limited.
“His low approval ratings mean a significant negative reaction from equities may be avoided,” said Charu Chanana, global market strategist and head of FX strategy at Saxo.
The stock market had also tracked overnight gains in Wall Street after US producer prices data buoyed bets for the Federal Reserve to cut interest rates in September.
However, the gains narrowed as investors locked in profits and attention turned to the closely-watched US consumer prices data due later on Wednesday.
While the inflation report could bolster confidence of a US rate cut, retail sales and labour-related data scheduled for later in the week remain key, Chanana said.
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