The Japanese stock market saw a notable rise on Friday, continuing the upward trend established over the previous two sessions. This movement comes in response to mixed signals from Wall Street and positive reactions to domestic economic data. The Nikkei 225 index has surged past the 39,900 mark, with a broad rally seen across most sectors, particularly among major index constituents and technology stocks.
The Nikkei 225 Index advanced by 398.19 points or 1.01 percent to reach 39,966.25, after hitting an intraday high of 39,975.44. This follows a significant increase in Japanese stocks, which closed with gains on Thursday.
Notable performances included Market heavyweight SoftBank Group and Fast Retailing, owner of Uniqlo, both climbing over 1 percent. In the automotive sector, Honda saw an increase of 1.5 percent, and Toyota rose by more than 1 percent.
In the technology realm, Advantest climbed 1.5 percent, Tokyo Electron added almost 1 percent, and Screen Holdings advanced nearly 2 percent. The banking sector witnessed Mitsubishi UFJ Financial gaining over 1 percent, with Mizuho Financial rising nearly 1 percent and Sumitomo Mitsui Financial edging 0.5 percent higher.
Among major exporters, Mitsubishi Electric and Panasonic saw modest increases between 0.2 and 0.4 percent each, while Sony gained over 1 percent and Canon almost 1 percent. Other significant gainers included DeNA, which soared almost 11 percent, and Socionext and OKUMA, each increasing by more than 5 percent. Nidec, Renesas Electronics, and Rakuten Group each climbed almost 4 percent, and Shiseido and Tokyo Tatemono rose by over 3 percent, with M3 also up nearly 3 percent.
Conversely, there were no prominent declines noted.
On the economic front, retail sales in Japan posted a 2.8 percent year-on-year increase in November 2024, a significant rise from a downwardly revised 1.3 percent growth in October, surpassing market expectations of 1.7 percent growth. Month-on-month, retail sales grew by 1.8 percent in November, marking the first increase in three months and the highest since September 2021, rebounding from a revised 0.2 percent decline in October.
Japan's unemployment rate held steady at 2.5 percent in November, aligning with both the previous month and market forecasts. The jobs-to-applications ratio remained at 1.25, consistent with October's figure and market expectations.
The core consumer price index for Tokyo's Ku-area rose 2.4 percent year-on-year in December 2024, up from 2.2 percent in November 2024, the highest level since August, albeit slightly below market consensus of 2.5 percent.
In terms of industrial production, Japan experienced a 2.3 percent month-over-month decline in November 2024, which was above market estimates predicting a 3.4 percent fall, following a 2.8 percent growth in the previous month. Year-on-year, industrial production decreased 2.8 percent, reversing from a 1.4 percent increase in October.
In foreign exchange markets, the U.S. dollar was trading in the higher 157 yen range on Friday.
Over on Wall Street, stocks managed to recover some ground throughout Thursday, despite an initial dip early in the session. The major averages closed with marginal differences, predominantly hovering near the neutral line for much of the session. The Dow managed a slight gain of 28.77 points or 0.1 percent to close at 43,325.80, while the Nasdaq slipped by 10.77 points or 0.1 percent to 20,020.37, and the S&P 500 edged down by 2.45 points or less than 0.1 percent to 6,037.59.
Meanwhile, key European markets remained closed in observance of Boxing Day.
Crude oil prices struggled to maintain early gains and ultimately settled lower on Thursday due to uncertainties around future global oil demand and a potential oversupply. West Texas Intermediate crude oil futures for February declined $0.48 or nearly 0.7 percent, settling at $69.62 per barrel.