Nikkei Poised for Correction After Record High, What's Happening?
The Japanese stock index is expected to weaken after a strong rally that sent the market to a record high on Tuesday. After the euphoria, market participants are anticipating profit-taking—especially as global sentiment turns less favorable.
Pressure is coming from Wall Street: US technology stocks fell overnight, and this could "contagious" to the Japanese technology sector, which had previously been a driving force behind the rally.
Early signs are already visible in the derivatives market. Nikkei 225 futures fell 1.0% to 54,025 on the Singapore Exchange—an indication that the market is opening the day on a more cautious note.
On the currency side, the USD/JPY pair was at 155.78, up from 155.43 at the Tokyo stock market close on Tuesday. The yen's movement could also influence exporter stocks and overall risk sentiment.
Investors' focus now shifts to the earnings season. Two major issuers to watch on Wednesday are Marubeni and Mitsubishi Heavy Industries—their results could be "decisive" after the index has already risen too rapidly.
For context, on Tuesday, the Nikkei Stock Average shot up 3.9% and closed the day at an all-time high of 54,720.66. After such a wild surge, the market typically enters a testing phase: will it make a healthy correction first, or will it continue to soar? (asd)
Source: Newsmaker.id
