Japan Nikkei extends gain ahead of BoJ meeting outcome

Japan stock market finished session slightly higher on Tuesday, 23 April 2024, extending yesterdays gain, as buying encouraged by tracking overnight rallies on Wall Street. However, market gains capped ahead of the upcoming corporate earnings and Bank of Japan's policy meeting later this week.

The 225-issue Nikkei Stock Average index added 113.55 points, or 0.3%, to finish at 37,552.16. The broader Topix index of all First Section issues on the Tokyo Stock Exchange rose 3.77 points, 0.14%, to 2,666.23.

Total 20 of 33 TSE sectors closed higher, with Insurance sector being top performer in percentage term, rising 1%, followed by Securities & Commodities Futures (up 0.9%), Construction (0.7%), and Foods (0.62%). Marine Transportation was bottom performing sector in percentage term, down 1.5%, followed by Rubber Products (down 1.1%) and Metal Products (down 0.95%) sectors.

 

Shares of export-related companies declined. Sony Group slipped 0.28% to 12,495 yen. Honda fell 0.51% to 1,764.5 yen. Shipping firm Nippon Yusen lost 2.15% to 4,146 yen.

ECONOMIC NEWS: Japan Business Activity Growth Accelerates To Eight-Month High -The au Jibun Bank Flash Japan Services Business Activity Index posted 54.6 in April, up from a final reading of 54.1 in March. This signaled the sharpest expansion in Japan's services activity since May 2023. Underpinning business activity growth were faster new business inflows, the quickest in ten months. April data also indicated sustained pressure on capacity, leading to another solid expansion of employment levels. On prices, input cost inflation rose for a second successive month. As a result, Japanese service providers shared their additional cost burdens with clients, contributing to the strongest rise in selling prices in ten years. The headline au Jibun Bank Flash Japan Manufacturing Purchasing Managers' Index (PMI) rose from 48.2 in March to 49.9 in April to signal a near-stabilization of Japanese manufacturing business conditions. Both output and new orders fell at a slower rates in the latest survey period, with the decline in the latter easing to the softest in ten months. In turn, manufacturing sector confidence improved while employment growth accelerated. Finally, input cost inflation rose in April, leading average charges to rise at the fastest pace in nine months.

CURRENCY NEWS: The Japanese yen was little changed around upper-154 level against greenback on Tuesday on speculation that Japanese authorities may step into the market to slow the yen's weakness after the currency slid to its lowest level in more than 30 years. The yen was last quoted at 154.73 per US dollar compared with 154.84 on Monday.

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