Japan’s Nikkei rises as Powell’s comments lift Wall Street

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TOKYO — Japan’s Nikkei index rose on Thursday, following sharp rises on Wall Street overnight after U.S. Federal Reserve Chairman Jerome Powell struck a more dovish tone than market expected.

As of 0150 GMT, the Nikkei share average was up 1.1% at 28,274.82, poised to snap four consecutive losing sessions. But the index pared some early gains, with 60% of stocks trading on the main section of the Tokyo stock exchange seeing a slump.

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The broader Topix rose 0.18% to 1,989.03.

Wall Street ended sharply higher on Wednesday after Powell said the central bank could reduce the pace of its interest rate hikes as early as December.

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« Market participants remain cautious as they await the release of U.S. employment data soon, » said Takatoshi Itoshima, strategist at Pictet Asset Management Japan.

“The market could go up or down once investors digest the slower pace of US rate hikes later in the month. One could also worry about deteriorating corporate earnings due to the slowing economy.

Closely watched nonfarm payrolls data from the U.S. Department of Labor is due Friday.

Chip-heavy stocks followed the Philadelphia Semiconductor index’s 5.85% gain.

Tokyo Electron jumped 4.17% and Advantest 3.5%. Technology investor SoftBank Group climbed 2.3%.

Eisai jumped 6.24%, extending its strong gains from the previous session, as the drugmaker plans to secure full approval for its experimental Alzheimer’s disease drug lecanemab in the States. United States, Europe and Japan.

The insurance and banking sectors fell 1.57% and 1.37%, respectively, on lower US Treasury yields.

Regional banking groups Shizuoka Financial Group fell 3.68% and were the biggest losers on the Nikkei, and Fukuoka Financial Group lost 2.71%.

Insurers Sompo Holdings 2.92% and MS&AD Insurance Group Holdings 2.37%. (Reporting by Junko Fujita; Editing by Uttaresh.V)