FX.co ★ Japanese Market Modestly Higher

The Japanese stock market showed modest gains in post-holiday trading on Tuesday, recovering some of the sharp losses from the previous session. Led by index heavyweights and financial stocks, the Nikkei 225 surpassed the 41,300 mark, bolstered by broadly positive cues from Wall Street.

The Nikkei 225 Index increased by 142.01 points or 0.34 percent to reach 41,326.48, having touched a high of 41,520.07 earlier in the session. It had ended significantly lower on Friday before the holiday on Monday.

Among market heavyweights, SoftBank Group saw gains of more than 1 percent, whereas Fast Retailing, the operator of Uniqlo, declined by nearly 1 percent. In the automotive sector, Honda gained almost 1 percent, while Toyota saw a slight increase of 0.5 percent.

The tech sector also experienced gains, with Advantest and Tokyo Electron each up almost 1 percent, and Screen Holdings edging higher by 0.1 percent. In banking, Mitsubishi UFJ Financial and Sumitomo Mitsui Financial both rose nearly 2 percent, while Mizuho Financial added almost 1 percent.

Most major exporters saw positive movements. Mitsubishi Electric climbed nearly 2 percent, Canon added over 1 percent, Panasonic slid almost 2 percent, and Sony remained flat.

Other significant gainers included Taiyo Yuden, which soared nearly 9 percent; Mitsubishi Heavy Industries and Alps Alpine, both surging almost 6 percent; and Murata Manufacturing and TDK, each gaining over 5 percent. Additional notable advances were seen with Kawasaki Heavy Industries up nearly 5 percent, IHI rising over 4 percent, and Fanuc advancing close to 4 percent. NEC and Japan Steel Works were both up more than 3 percent, while Hitachi, Komatsu, Daiwa Securities, MS&AD Insurance, and Marubeni each gained approximately 3 percent.

Conversely, Eisai dropped over 4 percent, and Shiseido declined nearly 3 percent.

In the currency market, the U.S. dollar was trading in the higher 158 yen range on Tuesday.

On Wall Street, the mood was positive on Monday, with two of the three major indices reaching record highs due to strong buying across various sectors. Optimism about potential interest rate cuts by the Federal Reserve and increasing prospects of former President Donald Trump winning the upcoming presidential elections contributed to the upbeat sentiment.

The Dow Jones Industrial Average ended up 210.82 points or 0.53 percent at 40,211.72, after reaching a new high of 40,351.10. The S&P 500 hit a new high of 5,666.94 before closing at 5,631.22, up 15.87 points or 0.28 percent. Meanwhile, the Nasdaq gained 74.12 points or 0.4 percent to end at 18,472.57, having peaked at 18,641.53 during the session.

In Europe, major markets moved downward. The FTSE 100 in the U.K. fell by 0.85 percent, Germany's DAX dropped 0.84 percent, and France's CAC 40 declined by 1.19 percent.

Crude oil prices settled lower on Monday, impacted by political uncertainty following an assassination attempt on former President Donald Trump and weak economic data from China. West Texas Intermediate (WTI) crude oil futures for August closed down $0.30 at $81.91 per barrel.