Updated December 29th, 2023 at 08:59 IST
Japan's Nikkei poised for decade-high annual gain despite year-end dip
The index achieved a 33-year high in November, prompted by a rare call from the Tokyo Stock Exchange to improve capital efficiency.
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On the final trading day of 2023, Japan's Nikkei share average experienced a marginal decline as investors grappled with a lack of clear market cues. The index, however, is on track to achieve its most substantial annual gain in a decade, showcasing resilience amid market uncertainties.
At the midday break, the Nikkei was down 0.21 per cent at 33,470.37, retracing from earlier gains of up to 0.3 per cent. Takehiko Masuzawa, the trading head at Phillip Securities Japan, attributed the mixed market movements to investors reshuffling their portfolios, favoring underperforming stocks over those that had recently outperformed.
Despite the day's fluctuations, the Nikkei is set to mark its most significant yearly gain since 2013, coinciding with Haruhiko Kuroda's tenure as the Governor of the Bank of Japan, during which he initiated substantial monetary easing measures to enhance asset values.
The index achieved a 33-year high in November, prompted by a rare call from the Tokyo Stock Exchange to improve capital efficiency. Additionally, the Nikkei is positioned as the best-performing major stock index, driven by the Yen's depreciation against the Dollar and Warren Buffett's Berkshire Hathaway increasing stakes in local firms, contributing to positive investor sentiment.
The broader Topix index showed a 0.21 per cent gain on the same day, supported by Toyota Motor's 1.58 per cent rise. Despite Toyota's 7 per cent monthly decline due to a safety scandal affecting its small-car unit Daihatsu Motor, the overall market remained buoyant. Sony Group also contributed to Topix's gain with a 0.37 per cent increase.
Rakuten Group emerged as the top performer on the Nikkei, jumping 4.67 per cent, following the announcement that subscribers to its mobile phone services surpassed 6 million in the current month.
However, energy explorers faced a setback, declining by 0.88 per cent and ranking as the worst-performing among the 33 industry sub-indexes. Refiners also experienced a dip of 0.61 per cent.
As the year concludes, the Nikkei's impressive annual performance highlights its resilience and attractiveness to investors, even amid periodic market fluctuations.
(With Reuters inputs.)
Published December 29th, 2023 at 08:59 IST