Japan Stocks Climb as Government Plans Record Budget Proposa
Asia-Pacific Stocks Mostly Up as Markets Reopen After Boxing Day
Asia-Pacific stock markets were mostly higher on Thursday, though several markets remained closed for the Boxing Day holiday.
In Japan, the Nikkei 225 gained 1.12%, closing at 8,220.9, while the Topix rose 1.20%, finishing at 2,766.78. This surge followed news that Japan is preparing a record ¥735 billion budget for the fiscal year starting in April. The budget is expected to cover rising social security and debt-servicing costs, according to a draft reviewed by Reuters.
On Wednesday, Bank of Japan Governor Kazuo Ueda stated that Japan’s economy is expected to move closer to a sustainable 2% inflation rate in 2025, accompanied by wage increases. As a result, the 10-year Japan government bond yield rose by 1.3 basis points to 1.078%, while the yen strengthened to 157.16 against the dollar, signaling market expectations for potential interest rate hikes.
Shares of Japanese automakers surged, with Nissan rising 6.58% and Honda climbing 3.84%. Both companies began official negotiations earlier in the week to merge, a move that could create the world’s third-largest carmaker by sales.
Japan Airlines shares closed 0.24% lower after a cyberattack caused delays to both domestic and international flights. The airline has since restored its systems to normal.
In South Korea, the Kospi index dropped 0.44%, closing at 2,429.67, while the Kosdaq fell 0.66%, closing at 675.64. Tensions have risen as the opposition Democratic Party submitted a bill to impeach acting President Han Duck-soo, with a vote expected on Friday, according to Yonhap news agency.
Meanwhile, Alibaba Group Holding is reportedly nearing an agreement to combine its South Korean business with E-Mart’s e-commerce platform, a move aimed at strengthening its position in the country’s growing online retail market. E-Mart shares closed 5.45% higher on the news.
In China, the CSI 300 inched higher, closing at 3,987.48, after the World Bank raised its GDP growth forecast for the country in 2024 and 2025. China’s GDP is now projected to grow by 4.9% in 2024, up from the previous forecast of 4.8%, and 4.5% in 2025, compared to the earlier prediction of 4.1%.
TICKER COMPANY NAME PRICE CHANGE %CHANGE
.N225 Nikkei 225 Index 39,568.06 +437.63 +1.12%
.HSI Hang Seng Index 20,098.29 +215.16 +1.08%
.AXJO S&P/ASX 200 8,220.90 +19.30 +0.24%
.SSEC Shanghai 3,398.08 +4.73 +0.14%
.KS11 KOSPI Index 2,429.67 -10.85 -0.44%
.FTFCNBCA CNBC 100 Asia 10,002.64 +36.92 +0.37%
In China, the government announced that efforts to stabilize the real estate market will continue in 2025, including measures to control the supply of commercial housing and optimize availability.
Singapore’s manufacturing output rose 8.5% in November compared to the same month last year, driven by strong performance in the electronics sector. This marks the fifth consecutive month of growth, although it fell short of Reuters’ 10% growth forecast. On a seasonally adjusted month-on-month basis, manufacturing output contracted by 0.4%, missing the expected 0.8% growth.
Markets in Australia, New Zealand, and Hong Kong were closed for Boxing Day.
Overnight in the U.S., markets were closed for Christmas. However, stocks surged on Tuesday, with the S&P 500 gaining 1.1% to 6,040.04. The Dow Jones Industrial Average rose by 390.08 points, or 0.91%, to 43,297.03, and the Nasdaq Composite climbed 1.35% to 20,031.13, fueled by a 7.4% jump in Tesla shares.
Tuesday marked the beginning of the seasonal Santa Claus rally, which typically occurs during the last five trading days of the year and the first two of January.
