The Nikkei Stock Average rose 0.4% to 61683.96 as gains in electronics stocks including Hitachi and Kokusai Electric offset a decline in financial shares. The broader Topix index fell 0.6% to 3949.23, weighed by Nomura Holdings and Mizuho Financial Group. The dollar traded at 163.26 yen, down from 163.55 at Wednesday's Tokyo close.
The Nikkei 225 rose 0.4% to 61683.96, led by electronics stocks, while financial shares dragged the broader Topix lower.
"Investors are closely watching earnings, developments in the Middle East and crude oil prices," according to the Nikkei market summary from Dow Jones Newswires.
Hitachi Ltd. gained 3.3% and Kokusai Electric jumped 4.7%, powering the benchmark's advance. On the downside, Nomura Holdings tumbled 6.7% and Mizuho Financial Group fell 2.8%, pulling the Topix index down 0.6% to 3949.23. The divergence between the two Japanese benchmarks reflected a rotation out of financials into electronics names, with the Nikkei's 1,743 constituents showing a clear sector split.
The dollar weakened to 163.26 yen from 163.55 at Wednesday's Tokyo close, providing some support for export-oriented electronics companies that benefit from a weaker yen. The currency move comes as the Bank of Japan's policy trajectory remains a key focus for traders, with the yen having strengthened from multi-decade lows earlier this year. A softer yen typically boosts the earnings outlook for Japanese exporters by increasing the value of overseas revenue when converted back to yen.
The Nikkei's modest gain contrasts with broader weakness across Asian equity markets. The Hang Seng Index has surged about 14% from its year-to-date low as investors rotate into Chinese technology names including Xiaomi, which has risen 45% in the past month, and Meituan, up 37% over the same period. Meanwhile, South Korea's Kospi has fallen about 40% from its year-high, dragged by a 44% decline in Samsung Electronics and a 53% drop in SK Hynix as the artificial intelligence trade unwinds. Japan's Nikkei remains about 15% below its peak for the year, with semiconductor-related stocks including Tokyo Electron and Advantest also coming under pressure in recent weeks.
The Nikkei's advance, while modest, suggests selective buying in electronics names as investors position for the upcoming earnings season. With the benchmark holding above the 61,000 level, traders are watching for further catalysts including corporate results from major exporters and any escalation in Middle East tensions that could drive crude oil prices higher, potentially squeezing margins in import-dependent sectors. The next key test for Japanese equities will come as companies report quarterly results, with analysts focused on guidance for the second half of the fiscal year.
This article is for informational purposes only and does not constitute investment advice.
