Nikkei 225 Bucks Prevailing Trend to Record Friday Gain

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With Asian indices are set to close mixed on Friday following a Thursday session in which all three major indices finished down, the Nikkei 225 is set to close higher in Tokyo despite a strengthening in the yen. The week’s tone, in the run up to Trump’s inauguration today, has been muted for global equities markets as traders hold fire. The rally which followed Trump’s election in November has paused this week as market participants now wait to see how his administration will set out policy and begin to act, once in office.

© Mike Hodges

European indices also finished down yesterday after an afternoon recovery following ECB head Mario Draghi’s press conference during which he struck a somewhat dovish tone. Interest rates and the ECB’s bond buying stimulus package are to remain as they have been.

Chinese data on 2016 GDP growth showed slowing growth, 6.7% for the year, down from 6.9% in 2015. Q4 GDP was 6.8%. Despite full year growth slowing, the figure met forecasts and is within the Chinese government’s 6.5%-7% target range. The Q4 growth rate beat forecasts for 6.7%.

Today’s strongest riser on the Nikkei 225 has been Sumco Corp., which produces silicon wafers for use in semiconductors, up 5.29%. Trump’s incoming trade team will reportedly stick to the Obama-administration’s hard line on controlling Chinese ambitions in the semiconductor market. With worries state-subsidised investment in semiconductor technology could distort global markets in the same way Chinese steel has done, incoming commerce secretary Wilbur Ross has committed to a tough stance.

Among the major car manufacturers, Toyota has had a good Friday and is up 1.92%, while Honda has a modest gain of 0.1% and Nissan a 0.43% loss.

Panasonic is up 1.26% on news that the company will further develop its partnership with Tesla and work with the U.S. company on self-driving technology as well as the current tie-up on batteries. Beverages and beer company Kirin Holdings has a 1.28% gain on news Heineken is set to buy its Brazilian unit, with talks between the two reportedly at an advanced stage.

Today’s heaviest faller has been Nippon Paper Industries, which is down 2.07%, followed by seafood giant Maruha Nichiro. Marine products company Nippon Suisan Kaisha is next with a drop of 1.62%

Elsewhere in Asia, the Hang Seng is down 0.35% in Hong Kong and the ASX 200 0.66% in Australia. The Shanghai Composite is up 0.74%.

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