Account
New to ADSS? Open an
account now to get started.
Already have an account?
Add funds to your ADSS account
Account
New to ADSS? Open an
account now to get started.
Add funds to your ADSS account
What’s happening: Japanese stocks moved higher on Wednesday, recording gains for the fourth straight session.
What happened: The rise in the Nikkei 225 was driven by a decline in Japanese government bond yields and the yen.
Investor sentiment received a further boost from US President Donald Trump’s announcement to delay tariffs on the European Union, which raised prospects of trade tensions easing.
Why it matters: On Sunday, the US President announced his decision to delay imposing tariffs on the EU until July 9. The decision came after a phone call with European Commission President Ursula von der Leyen, who requested more time to arrive at a deal.
Meanwhile, trade talks between the US and Japan are in progress. Japan’s chief trade negotiator, Ryosei Akazawa, is looking to advance negotiations related to tariffs with the US and reach a trade deal before the G7 (Group of Seven) summit in June.
Japan’s Ministry of Finance is considering a pullback on the issuance of super-long-term bonds in a bid to contain rising yields. This move follows the lacklustre 20-year bond auction last week.
Market sentiment was also supported by Trump announcing his support for a deal between Nippon Steel and US Steel. Former President Joe Biden had blocked the agreement during his term.
Japan’s cabinet announced its approval for an emergency plan, which would allocate ¥388 billion from reserve funds. The latest move aims to provide support to households and businesses that are most impacted by US tariffs.
Bank of Japan Governor Kazuo Ueda recently warned about the risk of higher inflation, adding that the central bank plans to hike interest rates in case upcoming economic data continue to signal improvement in the Japanese economy.
Ueda’s comments came after data released last week showed a higher-than-expected increase in consumer inflation.
Japan’s Nikkei 225 rose 0.58% to trade at 37,944.03 this morning. Technology stocks were among the top performers, with shares of Advantest, Lasertec and Disco recording sharp gains. Industrials and financials also recorded notable gains during the session.
What to watch: Investors await the release of economic data on Japan’s unemployment rate, retail sales, industrial production and Tokyo core CPI on Friday. Analysts expect Japan’s unemployment rate to remain unchanged from the previous month at 2.5% in April.
The core consumer price index for the Ku-area of Tokyo, which rose 3.4% year-over-year in April, is expected to accelerate further to 3.5% on May. Retail Sales in Japan, which fell 1.2% in March, are expected to decline by 0.3% in April, while industrial production is projected to contract 1.4% in April following a 0.2% decline in March.
Context: The greenback moved higher against major peers this morning, as investors digested the latest economic data.
Details: The US dollar added to gains from the previous session after data showed a better-than-expected reading for consumer confidence for May.
The Conference Board said on Tuesday that its consumer confidence index jumped 12.3 points to a reading of 98.0 in May, after falling for five consecutive months. The reading came much better than market expectations of 87.0.
Another economic report showed that US durable goods orders dipped by 6.3% to $296.3 billion in April. Although this marked the sharpest decline since January 2024, the figure came in softer than market estimates of a 7.8% plunge.
Minneapolis Fed President Neel Kashkari called to maintain rates until there is more clarity on how tariffs impact inflation.
Sentiment was also supported by Trump’s decision to delay imposing tariffs on the European Union until July 9.
Investors continued monitoring the clearance of a spending and tax bill by the US Congress.
The US dollar index, which measures the greenback’s performance versus a basket of major peers, added more than 0.1% to reach 99.64 this morning. The EUR/USD forex pair slipped around 0.1% to 1.1318, while the GBP/USD declined 0.1% to 1.3491.
What to watch: Investors await the release of economic data on Richmond Fed manufacturing index (1800 UAE Time) and Dallas Fed services revenues index (1830 UAE Time) from the US today. The composite manufacturing index in the US Fifth District, which dipped to -13 in April from -4 in the previous month, is expected to improve slightly to a reading of -9 in May.
Analysts expect the Dallas Fed’s general business activity index for Texas services to improve to a reading of -10 in May, from -19.4 in April. The release of the FOMC minutes (2200 UAE Time) will also remain in focus.
Other Markets: European indices closed mostly higher on Tuesday, with the FTSE 100, DAX 40 and STOXX Europe 600 Index up by 0.69%, 0.83% and 0.33%, respectively, and the CAC 40 down by 0.02%.
China rejected recent allegations that it had provided lethal weapons to Russia in the Ukraine conflict. The news sent the RUB/USD pair lower in forex trading this morning.
Australia’s monthly Consumer Price Index rose 2.4% in April, unchanged from the previous two months. However, the recent reading came in above market estimates of a 2.3% rise, which exerted pressure on the AUD/USD forex pair.
South Korea’s Business Survey Index for the manufacturing sector climbed to 73 in May, from 68 in April. The region’s business sentiment surging to the highest level since July 2024 sent the KRW/USD pair higher in forex trading this morning.
Brazil’s Consumer Price Index increased by 0.36% during the first half of May, easing from 0.64% during the first half of the previous month, lending some support to the BRL/USD forex pair.
Spain’s industry confidence indicator edged lower to -4.2 in May, from April’s reading of -4.1, which sent the EUR/USD pair lower in forex trading this morning.
European Central Bank’s consumer inflation expectations (1200 UAE Time), UK’s 8-year Green Gilt auction (1300 UAE Time), Italy’s 6-month BOT auction (1310 UAE Time), Germany’s 15-year Bund auction (1330 UAE Time), India’s industrial production (1430 UAE Time), manufacturing production (1430 UAE Time) and M3 money supply (1530 UAE Time), US MBA mortgage applications (1500 UAE Time), Redbook index (1655 UAE Time), Richmond Fed manufacturing shipments index (1800 UAE Time), Richmond Fed services revenues index (1800 UAE Time), Dallas Fed services index (1830 UAE Time), 17-week Bill auction (1930 UAE Time), 2-year FRN auction (1930 UAE Time) and 5-year Note auction (2100 UAE Time), Canada’s 10-Year Bond auction (2000 UAE Time), as well as Russia’s industrial production (2000 UAE Time) and PPI (2000 UAE Time).
ADSS
8th floor, CI Tower
Corniche Road
PO Box 93894
Abu Dhabi
United Arab Emirates
Trading Services
ts@adss.com
+971 2 657 2414
Investing in CFDs involves a high degree of risk that you will lose your money due to the use of leverage, particularly in fast moving markets, where a relatively small movement in the price can lead to a proportionately larger movement in the value of your investment. This can result in loses that exceed the funds in your account. You should consider whether you understand how CFDs work and you should seek independent advice if necessary.
ADS Securities LLC – S.P.C (“ADSS”) is authorised and regulated by the Securities and Commodities Authority (“SCA”) in the United Arab Emirates under First Category: Dealing in Securities and Fifth category: Arrangement and advice (Introduction). ADSS is a Limited Liability Company – Sole Proprietorship Company incorporated under United Arab Emirates law. The company is registered with the Department of Economic Development of Abu Dhabi (No. 1190047) and has its principal place of business at 8th Floor, CI Tower, Corniche Road, P.O. Box 93894, Abu Dhabi, United Arab Emirates.
The information presented is not directed at residents of any particular country outside the United Arab Emirates and is not intended for distribution to, or use by, any person in any country where the distribution or use is contrary to local law or regulation.
ADSS is an execution only service provider and does not provide advice. ADSS may publish general market commentary from time to time. Where it does, the material published does not constitute advice, or a solicitation, or a recommendation to a transaction in any financial instrument. ADSS accepts no responsibility for any use of the content presented and any consequences of that use. No representation or warranty is given as to the completeness of this information. Anyone acting on the information provided does so at their own risk.
