Japan's Nikkei closes above 40,000 after Wall Street benchmarks hit record highs; China ‘Two Sessions’ meeting in focus (2024)

FAQs

Japan's Nikkei closes above 40,000 after Wall Street benchmarks hit record highs; China ‘Two Sessions’ meeting in focus? ›

TOKYO -- Japan's benchmark Nikkei Stock Average reached the key milestone of 40,000 on Monday, mainly led by gains in semiconductor stocks, which have been boosted by expectation of higher demand for generative artificial intelligence. The index closed up 198.41 points, or 0.5%, from Friday's close, at 40,109.23.

Tokyo's key Nikkei index saw its largest drop in more than three years on Friday, following reports that Israel carried out strikes on Iran and after chip giant TSMC spooked tech stocks.

Nikkei calculates and publishes various types of the indexes such as the "Nikkei Stock Average (Nikkei 225)" which is known as a representative Japanese stock market indicator, and the "JPX-Nikkei Index 400" which is jointly calculated with Japan Exchange Group and Tokyo Stock Exchange.

Japanese Stocks Are Most Exposed to Yen Volatility Since 2022. The Nikkei's advance has stalled since a world-beating rally pushed the gauge above 40,000 for the first time ever this week, and its increased correlation with the yen helps explain the sluggish turn of Japan's equity market.

The term Nikkei, from the Japanese word nikkei (日系, lit. "of Japanese lineage"), is often used to refer to Japanese people who emigrated from Japan and their descendants.

(Japanese: 株式会社日本経済新聞社, Hepburn: Kabushiki gaisha Nihon Keizai Shinbun-sha) is a Japanese media company which owns The Nikkei and the Financial Times.

The Nikkei index does not allow individual foreign investors to buy and manage stocks directly. However, investors can obtain exposure to the index by buying stocks through exchange-traded funds whose components correlate to the Index. Exchange-traded Funds (ETF) comprise a selection of stocks or other securities.

The Nikkei 225, or the Nikkei Stock Average (日経平均株価, Nikkei heikin kabuka), more commonly called the Nikkei or the Nikkei index (/ˈnɪkeɪ, ˈniː-, nɪˈkeɪ/), is a stock market index for the Tokyo Stock Exchange (TSE).

The Shanghai Stock Exchange (Chinese: 上海证券交易所, SSE) is a stock exchange based in the city of Shanghai, China. It is one of the three stock exchanges operating independently in mainland China, the others being the Beijing Stock Exchange and the Shenzhen Stock Exchange.

Why is Japanese yen losing value? ›

The yen has been steadily falling for more than three years and has lost about a third of its value since the start of 2021. The yen is also the lowest-rate, or yielding, G10 currency. That means investors are borrowing it cheaply and selling it to invest in higher-yielding currencies, driving its price down.

The US dollar is backed by all of the goods and services in the US economy, denominated in dollars, for which that dollar can be exchanged. Thus, so too, the Yen is backed by all that in the Japanese economy, denominated in Ten, for which that Yen can be exchanged.

But the yen is still considered undervalued compared to Japan's economic fundamentals — which are around 100 to 110 yen.

Japanese Generational Terms

A Japanese American elder could be of any generation, and currently most are Nisei and Sansei. . A more recent contemporary term, Nikkei, has been used to refer to Japanese Americans as a whole.

Southern California has the largest Japanese American population in North America and the city of Gardena holds the densest Japanese American population in the 48 contiguous states.

As of October 2023, the country with the highest number of Japanese residents except for Japan itself was the United States with almost 415 thousand Japanese citizens. In the respective year, the United States counted around four times as many Japanese citizens as the second-placed China.

Tokyo stocks fell sharply on Friday amid concern about slowing semiconductor demand and worries conflict could spread in the Middle East. Investors unloaded shares across the board with chip-related stocks bearing the brunt of the sales.

Since the beginning of 2021, the price of energy resources has risen rapidly due to a myriad of factors. Against this backdrop, Japan's trade surplus has shrunk with rising import prices. By August of that year, the country's imports exceeded exports, resulting in a trade deficit.

Japan's overall trade surplus is a result of its exports in the rubric machinery, scientific and optical equipment, telecommunications equipment, and semiconductors and electronic parts.

Here are some of the most significant components that influence the price of the index: News updates – regular updates about the state of the country's economic and political wellbeing can move the index price in either direction. Currency rates – a weaker or stronger Japanese yen (JPY) can affect the prices of stocks.