Japanese shares rose, rebounding from a four-day losing streak, as AI-related stocks climbed following an upbeat earnings forecast from US chip titan Nvidia Corp.
The broader Topix index climbed as much as 1.9% to 3,308 in early Tokyo trading, while the Nikkei 225 Stock Average rose as much as 2.2% to 49,626. Electronics makers contributed most to gains on the Topix.
The gains in Japan comes after Nvidia’s shares rose over 4% post-market after the company announced a better-than-expected revenue forecast for the January quarter.
Read: Nvidia’s Upbeat Forecast Soothes Fears of AI Spending Bubble
“Nvidia’s results were virtually flawless, and have been well-received by investors,” said Takashi Ito, senior strategist at Nomura Securities Co. The earnings should fuel a robust rebound in Japanese shares, he said.
Tech stocks have been among the biggest drags on Japanese equities this week, amid a worldwide pullback on worries their valuations were running too high. Nvidia’s results reassure investors that “the pace of AI spending is not an issue, for now,” said Ito.
Risks still linger for Japanese equities ahead of the announcement of Prime Minister Sanae Takaichi’s economic stimulus package, expected Friday, however. Government bond yields have risen to multi-decade highs, with the yen extending its decline to the 157 range to the dollar overnight.
Read: Market Euphoria Ends for Takaichi as Yen and Bonds Sink
“Growing concerns of Japan’s spending plans under Takaichi’s regime should keep investors on alert,” Thursday, said Amir Anvarzadeh, Japan equity strategist at Asymmetric Advisors Pte. Tokyo’s ongoing spat with Beijiing is another downside risk to keep in mind, he said.
This article was generated from an automated news agency feed without modifications to text.
