[Today’s Market] May 7 — Semiconductors, too strong. The Nikkei average reaches a new all-time high again

Nikkei Average Hits All-Time High

After Golden Week, Tokyo Market on the 7th saw strong buying from the outset.

The Nikkei Stock Average closed at 62,833 yen, up 3,320 yen from the previous Friday, marking another all-time high.

The previous day, the U.S. markets rose in both the Dow and the Nasdaq.

In addition to expectations for a swift resolution of the Iran situation, strength in AI semiconductor-related stocks lifted the market overall.

In particular, AMD’s 18% surge was intense, and the momentum spilled over into the Tokyo market.

In the Tokyo market,
Advantest, SoftBank Group, Tokyo Electron,
semiconductor core stocks drew buying interest.

These three stocks alone pushed the Nikkei Average up by about 1,700 yen.

Furthermore, Kioxia hit the ceiling limit and stayed there.

It was entirely the market’s star.

In the morning session, many sectors were negative, but towards the afternoon, buying spread across a wide range of stocks,
and the overall market closed near a broad-based advance.

On the other hand, oil-related stocks like INPEX and Oil & Gas Development were sold off on concerns about lower crude prices.

Also, IP-related names such as Nintendo and Sanrio tended to search for lows,
outcomes varied greatly by stock.

◆ Today’s Market Summary

・Nikkei Average up 3,320 to 62,833, an all-time high
・U.S. market rose, led by AI semiconductors
・AMD surge spreading to the Tokyo market
・Three major semiconductor stocks up roughly 1,700 yen for the Nikkei
・Kioxia hit the ceiling limit
・Buying expanded into the afternoon, near a broad-based advance
・Oil-related and IP-related stocks were weak; fortunes varied

◆ Investor Notes

Semiconductors remain strong.

This is clear enough.

However, after such a sharp rise, overheating risks are visible.

Strong begets buying.
Buying creates the impression of even stronger gains.

This seems to be the cycle in play.

On the other hand, not everything is being bought up.

Oil-related stocks declined, IP-related stocks were weak.

In other words, funds are being selectively allocated.

And tomorrow, many earnings announcements are scheduled.

Notably,
Toyota Motor and Sony Group earnings are in focus.

Depending on the results, they could move the mood of the entire Japanese market significantly.

Looking at today’s gains alone, it’s a fairly strong market.

However, the key is how earnings are absorbed going forward.

This will be important.

Will the semiconductor-led trend continue further?
Or will the main players shift to other stocks?

Stay grounded, but don’t miss opportunities.

Keep a close eye on where the next wave of funds may flow.