Tokyo stock market opens sharply higher after Wall Street rally

• The Nikkei 225 share index surged 2.67%, or 699.90 points, to 26,937.32 in early trading.
• The Topix index rose 2.04%, or 37.84% to 1,895.84.
• The strong opening occurred as the US market mounted a recovery after bumpy trade.

The Tokyo stock market opened substantially higher on Friday, following Wall Street’s substantial gains despite US inflation data exceeding expectations.

In early trading, the Nikkei 225 index surged 2.67 percent, or 699.90 points, to 26,937.32, while the Topix index rose 2.04 percent, or 37.84 points, to 1,895.

The strong opening occurred as the US market mounted a recovery after bumpy trade, with the Dow gaining 2.8% and the Nasdaq gaining 2.2%.

Analysts attribute the US advances to short-term moves and revived bullish attitudes following recent losses that have made certain companies more attractive.

“After the major overnight gains on Wall Street, the Tokyo stock market today should also see a large rebound in early trade,” brokerage house Monex said in a note.

“A key now is whether the Nikkei can maintain the momentum after early trade and try to advance to higher ranges,” the report added.

But the global market still faces many concerns.

Liz Truss and her beleaguered chancellor of the Exchequer, Kwasi Kwarteng, are under pressure to abandon more of their economic initiatives, which were the new leader’s top priority.

Additionally, investors were concerned about the rate and magnitude of US interest rate hikes to combat inflation.

On the foreign exchange market, the dollar continued to rise, fetching approximately 147.40 yen in Tokyo after reaching 147.66 yen overnight Thursday and 147.22 yen in late afternoon New York trading.

A month after the Japanese government interfered in the market to reverse the trend, the dollar rose.

Fast Retailing, the operator of Uniqlo, climbed 5.76 percent to 83,210 yen after announcing a record annual profit.

Sony Group shares increased 3.84 percent to 9,662 yen. SoftBank Group shares rose by 3.86 percent to 5,680 yen.

Advantest, a leading manufacturer of testing kits for semiconductors, increased its share price by 1.46 percent to 6,950 yen. Toyota climbed 0.88 percent to 2,001 yen. Inpex’s share price rose 1.14 percent to 1,503 yen.

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