Asian Shares Mostly Showed Gains – Nikkei Reached 42,000, Setting A New Record High For The Third Consecutive Day This Week

In today’s trading, Asian shares mostly gained following a strong rally on Wall Street, with Japan’s Nikkei 225 index surpassing the 42,000 mark for the first time. 



Amid rising uncertainties surrounding the Chinese economy and the upcoming US presidential elections, foreign investors are turning their attention to Japanese stocks as a potentially stable investment option. 

This new interest is bolstered by the recent strong performance of Japanese shares. On Thursday, the Nikkei stock average surged to an all-time intraday high, climbing 1.4% from the previous day’s close to reach 42,426.77. The Nikkei closed at 42,224.02, setting another all-time high. This follows February’s breakthrough of a record level that had stood since 1989.

This week, many global stock markets were uplifted by comments from US Federal Reserve Chairman Jerome Powell, which raised hopes for interest rate cuts. Yesterday, Powell informed Congress that the US is progressing towards price stability. He had previously stated that the central bank could lower rates once significant progress is made towards its inflation target, as the US economy is no longer overheating. 

As expectations for prolonged high US policy rates diminish, foreign investors are increasingly turning to Japanese stocks. Speculation suggests that Middle Eastern funds, possibly around 10 billion yen ($61.8 million), flowed into 14 major Japanese stocks in early July. 

Nozomi Moriya from UBS Securities noted interest from Middle Eastern investors but couldn’t specific flows or the start of this trend. Yunosuke Ikeda of Nomura Securities, on the other hand, highlighted the long-term perspective of Middle Eastern investors and the attractiveness of the weak yen. 

Meanwhile, Hong Kong’s Hang Seng index climbed 2.1% to 17,831.40, while the Shanghai Composite index surged 1.1% to 2,970.39.

In South Korea, Kospi also went up by 0.8% closing at 2,891.35. Australia’s S&P/ASX 200 went up by 0.9% closing at 7,889.60.

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Sophia Cruz
Financial Writer - Asian & European Desks
Sophia is an experienced writer, reporter and newsdesk member, mostly on the financial sectors. For the past 5 years Sophia has covered a wide variety of topics such as the financial markets, economics, technology, fin-tech and trading. Sophia has been a part of the FX Leaders team since 2017 and works on producing valuable content and information for traders of all levels of experience.
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