Key Facts
• On August 13, Nikkei 225 surpassed 43,000 for the first time, setting a record.
• TOPIX also achieved its fourth consecutive record high in trading.
• U.S. July Consumer Price Index (CPI) rose 2.7% year-on-year, below the 2.8% forecast.
• Federal Reserve’s September rate cut probability increased to 98% for a 25 basis point cut.
• Economist Takayuki Miyajima noted reduced stagflation concerns and potential for a 50 basis point cut.
• Nikkei 225 rose over 580 points, trading near 43,300, with over 60% of stocks gaining.
• Chief Strategist Hiroyuki Ueno attributed gains to rate cut expectations and reduced trade tensions.
• SoftBank Group shares fell after six days of gains, signaling selective stock adjustments.
• Analyst Tomoichiro Kubota warned of potential market shifts due to U.S. Producer Price Index (PPI) data.
• Risks include inflation persistence and Federal Reserve leadership uncertainties.
Summary
The Nikkei 225 reached a historic milestone on August 13, surpassing 43,000 points for the first time, driven by optimism surrounding a potential U.S. Federal Reserve rate cut in September. The U.S. July CPI data, which showed a 2.7% year-on-year increase, fell short of market expectations, boosting the likelihood of a 25 basis point rate cut to 98%. Analysts highlighted reduced stagflation fears and the possibility of a larger 50 basis point cut, which could further elevate stock prices. The TOPIX also marked its fourth consecutive record high, with over 60% of stocks on the Tokyo Stock Exchange Prime Market gaining. However, selective stock adjustments, such as a decline in SoftBank Group shares, and upcoming U.S. PPI data pose potential risks to the market’s momentum. Analysts caution that persistent inflation or uncertainties surrounding Federal Reserve leadership could shift market sentiment.
