Japanese stocks rose as the yen weakened, favoring exporters like Toyota and Mazda. The strong dollar against the yen benefits Japan’s export-driven economy, helping firms thrive in the U.S. market. Japan’s economy minister is leading trade discussions with the U.S. that President Donald Trump has deemed a “top priority.” Despite shelving currency manipulation claims, yen selling pressure continues.
The semiconductor sector is under scrutiny as TSMC in Taiwan reveals earnings. Tokyo’s oil and coal stocks are performing well amid high crude prices. However, analysts warn of potential disruptions from global trade tensions.
Japan’s markets are climbing with export gains from a weaker yen, but investors should prepare for possible volatility. U.S. trade policies may lead to supply chain shake-ups, affecting firms with high operational dependencies in Japan. Promising trade talks emphasize the intricate U.S.-Japan economic ties.
With increasing semiconductor supply challenges, positive trade relations are vital, as multinational agreements play a crucial role in shaping global economic policies.
Yen weakness boosts Japanese exports
U.S. stock futures rose as optimism over U.S.-Japan trade talks boosted investor sentiment.
Joanna Shen of JPMorgan Asset Management noted that current market volatility is largely driven by geopolitical tensions. S&P 500 contracts climbed, indicating a partial recovery after Wednesday’s decline. Nasdaq 100 futures increased, supported by an upbeat sales forecast from Taiwan Semiconductor Manufacturing Co.
In Europe, the Stoxx 600 index dipped as markets awaited the European Central Bank’s decision on interest rates amidst a busy day of corporate earnings reports. European shares fell, while the dollar rose as traders took some heart from trade talks between the U.S. and Japan. Gold hit a new record as Federal Reserve Chair Jerome Powell cautioned about the growth outlook.
Anticipation of the European Central Bank’s upcoming decisions saw the euro dipping. Market participants are closely watching for signals from the ECB regarding potential monetary policy adjustments. TSMC’s earnings remain in focus after warnings from tech giants Nvidia and ASML about their projected business outlooks.
