Japanese Market Notably Higher

The Japanese stock market is trading notably higher on Friday after briefly being in the red in early trades, recouping some of the sharp losses in the previous session, with the benchmark Nikkei 225 just above the 28,900 level, following the mixed cues overnight from Wall Street, as traders reacted to upbeat manufacturing and services PMI data.

Traders are also upbeat after a sharp drop in coronavirus infection rates has led to the gradual reopening of the nation’s economy with Tokyo and Osaka lifting curfews.

The benchmark Nikkei 225 Index is gaining 197.16 points or 0.69 percent to 28,905.74, after touching a high of 28,989.50 and a low of 28,546.57 earlier. Japanese shares closed sharply lower on Thursday.

Market heavyweight SoftBank Group is gaining almost 2 percent and Uniqlo operator Fast Retailing is flat. Among automakers, Honda is adding almost 1 percent and Toyota is edging up 0.5 percent.

In the tech space, Advantest is gaining almost 2 percent, Tokyo Electron is adding more than 4 percent and Screen Holdings are up almost 5 percent.

In the banking sector, Mitsubishi UFJ Financial and Sumitomo Mitsui Financial are edging up 0.4 percent each, while Mizuho Financial is losing more than 1 percent.

Among major exporters, Panasonic is edging up 0.4 percent and Sony is gaining almost 1 percent, while Canon and Mitsubishi Electric are flat.

Among the other major gainers, Nikon is gaining more than 4 percent and Toto is adding more than 3 percent, while Sumco and Komatsu are up almost 3 percent each.

Conversely, Toho Zinc is losing more than 6 percent, Z Holdings is down 4.5 percent, CyberAgent is declining more than 3 percent and Mitsui Mining & Smelting is lower by almost 3 percent.

In economic news, the manufacturing sector in Japan continued to expand in October, and at a faster pace, the latest survey from Jibun Bank showed on Friday with a manufacturing PMI score of 53.0. That’s up from 51.5 in September, and it moves further above the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the services PMI climbed to 50.7 in October from 47.4 in September, while the composite also rose to 50.7 from 47.9 a month earlier.

Further, overall inflation in Japan was up 0.2 percent on year in September, the Ministry of Internal Affairs and Communication said on Friday. That exceeded expectations for an increase of 0.1 percent following the 0.4 percent drop in August. Core CPI, which excludes volatile food prices, were up 0.1 percent on year – matching expectations following the flat reading in the previous month. On a seasonally adjusted monthly basis, overall inflation was up 0.4 percent and core CPI rose 0.1 percent.

In the currency market, the U.S. dollar is trading in the 114 yen-range on Friday.

On Wall Street, stocks moved mostly higher over the course of the trading day on Thursday, extending the upward trend seen over the past several sessions. The S&P 500 moved higher for the seventh straight session, reaching a new record closing high.

The tech-heavy Nasdaq climbed 94.02 points or 0.6 percent to 15,215.70 and the S&P 500 rose 13.59 points or 0.3 percent to 4,549.78, while the Dow climbed well off its worst levels but still edged down 6.26 points or less than a tenth of a percent to 35,603.08.

Meanwhile, the major European markets all moved to the downside on the day. While the U.K.’s FTSE 100 Index slid by 0.5 percent, the French CAC 40 Index and the German DAX Index both fell by 0.3 percent.

Crude oil prices tumbled on Thursday, weighed down by a forecast that U.S. weather this winter will likely be warmer than average. Profit taking after recent strong gains and lower coal and natural gas prices also contributed to oil’s decrease. West Texas Intermediate Crude oil futures for December ended down by $0.92 or 1.1 percent at $82.50 a barrel.

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