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EQUITIES: Japanese Equities Could See Further Upside Following Dovish Comments

EQUITIES
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  • On Wednesday, Japan's new Prime Minister Shigeru Ishiba signaled that the economy isn't ready for further interest-rate hikes, stressing the need for continued monetary easing to tackle deflation. While BOJ Governor Kazuo Ueda emphasized the need for caution, Ishiba's government aims to closely coordinate with the central bank, prioritizing economic stability.
  • The Yen weakened on the back of these comments, with the USD/JPY breaking above the 50-Day EMA, a level it has traded below since mid June. Expect exporters to be well supported following further weakening in the yen this morning.
  • Tech names should be well supported, especially semiconductor stocks today following comments made after hours from Nvidia's CEO where he confirmed the company's new Blackwell chips are in full production, with demand described as "insane", despite earlier concerns about delays.
  • Japanese equities have underperformed the past few session as all focus has been on Chinese names, however after a 13% rise in the HSI since Friday, we could potentially see a rotation back into Japanese stocks.
  • Nikkei closed 2.18% lower on Wednesday, with semiconductors the worst performing sector. Eyes will be on last weeks highs of 39,829 as resistance, 5% higher than last close.
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  • On Wednesday, Japan's new Prime Minister Shigeru Ishiba signaled that the economy isn't ready for further interest-rate hikes, stressing the need for continued monetary easing to tackle deflation. While BOJ Governor Kazuo Ueda emphasized the need for caution, Ishiba's government aims to closely coordinate with the central bank, prioritizing economic stability.
  • The Yen weakened on the back of these comments, with the USD/JPY breaking above the 50-Day EMA, a level it has traded below since mid June. Expect exporters to be well supported following further weakening in the yen this morning.
  • Tech names should be well supported, especially semiconductor stocks today following comments made after hours from Nvidia's CEO where he confirmed the company's new Blackwell chips are in full production, with demand described as "insane", despite earlier concerns about delays.
  • Japanese equities have underperformed the past few session as all focus has been on Chinese names, however after a 13% rise in the HSI since Friday, we could potentially see a rotation back into Japanese stocks.
  • Nikkei closed 2.18% lower on Wednesday, with semiconductors the worst performing sector. Eyes will be on last weeks highs of 39,829 as resistance, 5% higher than last close.