The upscale Ginza shopping district in Tokyo, Japan, on Saturday, May 4, 2024.
Bloomberg | Bloomberg | Getty Images
Japanese shares rebounded sharply on Tuesday after the Nikkei 225 and Topix fell more than 12% in the previous session. Other Asia-Pacific markets were also higher.
of Japan Nikkei 225 — which posted its biggest loss in the previous session since the Black Monday crash of 1987 — and the broad-based Topix gained more than 7% after hitting session highs of more than 10%. The resurgence has put both the Nikkei and Topix back in a year-to-date gain position.
The Bank of Japan raised interest rates to the highest level since 2008 on July 30 had sent the yen strengthening to a seven-month high, weighing on stocks.
Global markets were also spooked by fears of a US recession fueled by a weaker-than-expected jobs report.
Japan’s trading heavyweights all rebounded more than 6%, with Mitsui over 9%. Softbank Group Corp jumped more than 8%.
Other gainers also included Japanese automakers and semiconductor suppliers such as Honda and Renesas Electronicswhich increased over 13% and 17% respectively.
The yen fell 0.83% to trade at 145.37 against the US dollar.
of South Korea Kospi jumped more than 3%, while the small-cap Kosdaq rallied more than 5%. South Korean markets were temporarily halted on Monday after falling 8%, triggering circuit breakers.
South Korean heavyweight Samsung Electronics rose 2.1 percent, while chipmaker SK Hynix rose 4.5 percent.
Mainland China’s CSI 300 traded flat, while Hong Kong’s Hang Seng Index rose 0.9%.
Australia’s S&P/ASX 200 rose 0.4%.
Oil prices also rose by crude Brent rising 1.65% to $77.56 a barrel. US West Texas Intermediate Crude oil rose 1.86% to $74.30.
Japan June household expenditure figures showed a larger-than-expected year-on-year decline, falling 1.4% in real terms. The average monthly income per household increased by 3.1% in real terms compared to the previous year.
Real wages in Japan also rose 1.1% in June compared with a year ago, the first time wages rose in 26 months. Strong wage growth gives the Bank of Japan more room to tighten monetary policy.
The Reserve Bank of Australia decided to keep it fixed cash rate to 4.35% on Tuesday, as economists had expected. The bank noted that inflation has remained above the midpoint of its target for 11 consecutive quarters and that the economic outlook for Australia remains uncertain.
The RBA too slightly upgraded GDP growth forecasts for the year ended December to 1.7% from a previous forecast of 1.6% in May. Meanwhile, the CPI is now expected to fall to 3.0% for the year ended December compared to a previous expectation of 3.8%.
Overnight in the USA, the 30-stock Dow and S&P 500 marked their worst sessions since September 2022.
The Dow fell 1,033.99 points to close 2.6% lower, while the S&P 500 slipped 3%. The Nasdaq Composite lost 3.43% to close 15% from its closing high.
—CNBC’s Hakyung Kim, John Melloy and Sarah Min contributed to this report.