Japanese Stocks Rise as Yen Weakens While Investors Await BOJ
Japanese stocks rose as the yen weakened after Federal Reserve Chair Jerome Powell cautioned against assuming large rate cuts will continue. Investors are awaiting the Bank of Japan's decision Friday.
The benchmark Topix index gained 2.2% as of 9:26 a.m. in Tokyo, its highest intraday level since Sept. 4. Exporters of automobiles and electronics were the biggest contributors to the gauge. The Nikkei 225 Stock Average advanced 2.4%.
The yen erased gains that were triggered by the Fed's decision to cut its benchmark interest rate by a half percentage point. Powell signaled at a press conference following the announcement that it's not in a rush to ease policy. The yen was at 143.18 per dollar, after appreciating to 140.45.
"For Japanese equities, it was probably the ideal outcome that there was a large rate cut as expected but the yen didn't appreciate," said Rina Oshimo, a senior strategist at Okasan Securities. "Since the BOJ decision is expected to remain unchanged, attention is likely to focus on Governor Ueda's subsequent remarks."
Economists expect the BOJ to stand pat when its two-day meeting concludes Friday. Japanese stocks tumbled into a bear market in early August after BOJ's rate hike and Governor Kazuo Ueda's hawkish stance at his briefing sent the yen higher.
Source : Bloomberg
