【Fujitomi】Nikkei Stock Average index has generated a golden cross, but...

The Nikkei Stock Average closed up 36 yen 90 sen (0.19%) at 19,590 yen 76 sen, marking its first advance in three trading days. The rebound was driven by a rebound from the recent decline and by gains in U.S. stocks and a stabilization in the yen’s strength. After an initial rise, there were moments when position-driven selling appeared in the futures market due to geopolitical risk discussions around North Korea, but in the afternoon session of the Tokyo stock market, expectations for Bank of Japan ETF purchases emerged, and the gains broadened toward the close.

The U.S. Navy’s aircraft carrier Ronald Reagan stationed at the Yokosuka base is expected to be dispatched to the Korean Peninsula. The fleet of the nuclear-powered carrier Carl Vinson is already deployed in the area since the end of April, so having two U.S. aircraft carriers deployed simultaneously in the Sea of Japan would be highly unusual. Also, CNN reported that two Chinese fighter jets interfered with a U.S. Air Force aircraft over the Yellow Sea.

The TOPIX also rose for the first time in three trading days, up 4.72 points (0.30%) to 1,559.73. The total trading value on the Tokyo Stock Exchange First Section was 2.4077 trillion yen, with a trading volume of 1,908,630,000 shares. The number of advancing issues was 1,090, declining issues 804, and 121 were unchanged.

Nikkei futures rose for the first time in four trading days. They did not drop below the previous day’s low of 19,440 yen, and temporarily surpassed the high of 19,610 yen from the 18th. Today, not only in the futures but also in the Nikkei 225 itself, the 25-day and 75-day moving averages formed a gold cross, suggesting a potential test of higher levels next week. The ongoing tug-of-war between geopolitical risk, the outlook for the U.S. administration, and solid U.S. fundamentals remains a focal point.

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