EWJV - Japan's Nikkei rallies past 35000 for the first time since bubble era

2024-01-11 04:43:17 ET

Japanese stocks soared on Thursday, with the benchmark Nikkei 225 index ( NKY:IND ) crossing 35,000 points for the first time since the economic bubble over 30 years ago, while a weaker yen boosted exporter shares.

The blue-chip index ( NKY:IND ) ended 1.8% higher at 35,049.86, and is on track to post its biggest weekly gain in close to four years. The broader Tokyo Stock Price Index, or Topix, closed up 1.6% at 2,482.87 points. The yen ( USD:JPY ) weakened to around 145.56 against the U.S. dollar.

"Japanese stocks have been cheap for a long time, along with corporate governance reforms and the effect of Warren Buffett from last year," said Ayako Sera, market strategist at Sumitomo Mitsui Trust Bank, referring to the American' billionaire boosting his stakes in Japanese trading firms .

While traders continue to expect growth to return to the Japanese economy after years of deflation, weaker wage data capped bets of the Bank of Japan raising interest rates soon.

Inflation-adjusted real wages fell 3.0% Y/Y in November, marking the 20th straight month of contraction. BOJ Governor Kazuo Ueda previously said there needed to be a sustainable increase in wages before monetary policy could be tightened.

The latest wage data "gave Nikkei ( NKY:IND ) the excuse to pop up towards the 35,000 level," said IG analyst Tony Sycamore, adding that more gains are likely "while we try and work out when the BOJ can look to take its next step."

More on Japan

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• iShares MSCI Japan ETF: The Stars Are Aligning
• Nikkei ends lower again as Japan rate hike bets grow
• Warren Buffett ramps up bets on Itochu, other trading houses

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