Japanese Market Slightly Higher

The Japanese stock market is slightly higher in choppy trading on Thursday, extending the gains in the previous four sessions, with the Nikkei 225 off the 33-year highs and staying above the 33,500 level, following the mostly positive cues from global markets overnight, aided by gains in technology stocks. Traders also expect the Bank of Japan to maintain its ultra-loose policy when it meets on Friday.

The benchmark Nikkei 225 Index is up 32.86 points or 0.10 percent to 33,535.28, after touching a high of 33,659.75 earlier. Japanese stocks closed sharply higher on Wednesday.

Market heavyweight SoftBank Group is losing almost 1 percent and Uniqlo operator Fast Retailing is declining more than 1 percent. Among automakers, Toyota is edging up 0.3 percent, while Honda is losing 1.5 percent.

In the tech space, Screen Holdings is gaining more than 3 percent, Tokyo Electron is adding almost 2 percent and Advantest is advancing almost 4 percent.

In the banking sector, Mitsubishi UFJ Financial is edging up 0.1 percent, while Sumitomo Mitsui Financial is edging down 0.3 percent and Mizuho Financial is losing more than 1 percent.

Among the major exporters, Panasonic is losing almost 1 percent, while Canon and Sony are edging down 0.2 to 0.5 percent each. Mitsubishi Electric is edging up 0.3 percent.

Among the other major gainers, Nikon is gaining more than 4 percent, Renesas Electronics is adding almost 4 percent, Kubota is advancing more than 3 percent and Nintendo is up almost 3 percent.

Conversely, Daiichi Sankyo is losing more than 3 percent and Sumitomo Pharma is down almost 3 percent.

In economic news, Japan posted a seasonally adjusted merchandise trade deficit of 1,362.5 billion yen in May, the Ministry of Finance said on Thursday. That missed expectations for a shortfall of 1,331.9 billion following the 432.3 billion yen deficit in April.

Exports were up 0.6 percent on year to 7,292.6 billion yen, exceeding forecasts for a 0.8 percent decline following the 2.6 percent gain in the previous month. Imports dropped an annual 9.9 percent to 8,665.1 billion yen versus expectations for a decline of 10.3 percent after slipping 2.3 percent a month earlier.

Meanwhile, the Cabinet Office said on Thursday the value of core machine orders in Japan was up a seasonally adjusted 5.5 percent on month in April, coming in at 900.0 billion yen. That beat expectations for a gain of 3.0 percent following the 3.9 percent decline in March.

On a yearly basis, core machine orders slumped 5.9 percent – but that also exceeded expectations for a drop of 8.0 percent after sinking 3.5 percent in the previous month. For the second quarter of 2023, core machine orders are seen higher by 4.6 percent on quarter and lower by 1.6 percent on year.

In the currency market, the U.S. dollar is trading in the higher 140 yen-range on Thursday.

On Wall Street, stock saw substantial volatility following the Federal Reserve’s monetary policy announcement on Wednesday. The major averages showed wild swings back and forth across the unchanged line before eventually closing mixed.

The Nasdaq climbed 53.16 points or 0.4 percent to13,626.48 and the S&P 500 inched up 3.58 points or 0.1 percent to 4,372.59, once again reaching their best closing levels in over a year. Meanwhile, the narrower Dow slid 232.79 points or 0.7 percent to 33,979.33, pulling back off Tuesday’s four-month closing high.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.’s FTSE 100 Index inched up by 0.1 percent, the French CAC 40 Index and the German DAX Index both rose by 0.5 percent.

Crude oil prices pared early gains and drifted lower Wednesday after data showed a notable increase in U.S. crude inventories last week, while a stronger greenback also weighed. West Texas Intermediate Crude oil futures for July sank $1.15 or 1.7 percent at $68.27 a barrel.

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