TOKYO: Tokyo stocks ended higher on Tuesday, extending Wall Street rallies as markets showed cautious optimism ahead of key US inflation data and a closely watched Federal Reserve meeting.
The benchmark Nikkei 225 index closed up 0.40 percent, or 112.52 points, to end at 27,954.85, while the broader Topix index was up 0.43 percent, or 8.35 points, at 1,965.68.
The dollar stood at 137.57 yen, against 137.66 yen in New York.
The Japanese market took heart from gains in New York, where investors bought up shares to square their positions ahead of the Fed meeting and key US data release, Tokai Tokyo Securities said in a commentary.
The US central bank is widely expected to lift interest rates 50 basis points on Wednesday – a slowdown from its previous 75-point hikes.
If the anticipated slowdown doesn’t materialise, however, “that would betray the expectations of investors and is likely to send a ‘negative shockwave’ throughout the market”, Tokai added.
Investors are set to digest new consumer price index (CPI) data – a key measure of inflation – due ahead of this week’s Fed meeting.
“The CPI reading later on Tuesday should be vital to setting the tone for (Fed boss Jerome) Powell’s press conference,” Stephen Innes of SPI Asset Management said in a note.
Japan’s Nikkei falls as tech stocks drag ahead of Fed meet
The Fed meeting and CPI release are “this year’s last important events, so the mood is strong among investors that they want to sit tight to assess the situation”, Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP.
Among major shares in Tokyo, SoftBank Group was up 0.12 percent to 6,213 yen, Sony Group grew 1.05 percent to 10,990 yen and Uniqlo operator Fast Retailing jumped 1.52 percent to 85,180 yen.
Toyota, meanwhile, also added 0.28 percent to 1,968.5 yen.
Comments
Comments are closed for this article.