Japan's Nikkei Stock Average Rises as Weaker Yen Provides Boost to Exporters
The Tokyo Stock Exchange
TOKYO, June 16 (Reuters) – Japan's Nikkei share average rose on Monday even as the conflict between Israel and Iran continued, with a weaker yen supporting sentiment.
As of 0155 GMT, the Nikkei .N225 was up 0.9% at 38,164.07, while the broader Topix .TOPX rose 0.54% to 2,772.46.
'Investors were less worried about geopolitical tensions in the Middle East, and the market saw no need for additional sell-offs,' said Kentaro Hayashi, senior strategist at Daiwa Securities.
'There is an optimism that the conflict will be contained with countries like the United States and Russia stepping in,' he added.
The Nikkei fell on Friday after Israel launched strikes against Iran, and Wall Street ended sharply lower later in the day.
On Monday, Advantest 6857.T jumped 8% to provide the biggest boost to the Nikkei. The chip-making equipment maker, one of the largest components of the Nikkei, tends to be bought when the market bets the upside of the benchmark index.
Automakers rose on the back of a weaker yen, with Honda Motor 7267.T and Nissan Motor 7201.T rising 3.4% and 1%, respectively. Toyota Motor 7203.T was up 0.4%.
The yen fell at the end of the week as investors bought safe-haven assets, such as the U.S. dollar.
The greenback was last up 0.17% to 144.325 against the Japanese yen JPY=EBS.
A weaker Japanese currency tends to boost shares of exporters, as it increases the value of overseas profits in yen terms when firms repatriate the money to Japan.
Nippon Steel 5401.T rose 2.4% after U.S President Donald Trump approved its $14.9 billion bid for U.S. Steel X.N on Friday.
The sector for steel makers .ISTEL.T rose 1.77% to become the top performer among the Tokyo Stock Exchange's (TSE) 33 industry sub-indexes.
The shipping sector .ISHIP.T rose 1.66% on expectations for rising freight rates amid the Middle East conflict. Kawasaki Kisen 9107.T rose 2.4%.
Of more than 1,600 stocks trading on the TSE's prime market, 66% rose and 28% fell with 4% trading flat.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Nikkei Asia
26 minutes ago
- Nikkei Asia
US and EU agree to 15% tariffs, $600bn in investments from Europe
TURNBERRY, Scotland (Reuters) -- The United States struck a framework trade agreement with the European Union on Sunday, imposing a 15% import tariff on most EU goods, half the threatened rate, and averting a bigger trade war between two allies that account for almost a third of global trade. U.S. President Donald Trump and European Commission President Ursula von der Leyen announced the deal at Trump's luxury golf course in western Scotland after an hourlong meeting that pushed the hard-fought deal over the line. "I think this is the biggest deal ever made," Trump told reporters, lauding EU plans to invest some $600 billion in the United States and dramatically increase its purchases of U.S. energy and military equipment. Trump said the deal, which tops a $550 billion deal signed with Japan last week, would expand ties between the trans-Atlantic powers after years of what he called unfair treatment of U.S. exporters. Von der Leyen, describing Trump as a tough negotiator, said the 15% tariff applied "across the board," later telling reporters it was "the best we could get." "We have a trade deal between the two largest economies in the world, and it's a big deal. It's a huge deal. It will bring stability. It will bring predictability," she said. The deal, which Trump said calls for $750 billion of EU purchases of U.S. energy in coming years and "hundreds of billions of dollars" of arms purchases, likely spells good news for a host of EU companies, including Airbus, Mercedes-Benz and Novo Nordisk, if all the details hold. The baseline 15% tariff will still be seen by many in Europe as too high, compared with Europe's initial hopes to secure a zero-for-zero tariff deal, though it is better than the threatened 30% rate. German Chancellor Friedrich Merz welcomed the deal, saying it averted a trade conflict that would have hit Germany's export-driven economy and its large auto sector hard. German carmakers Volkswagen, Mercedes and BMW were some of the hardest hit by the 27.5% U.S. tariff on car and parts imports now in place. But Bernd Lange, the German Social Democrat who heads the European Parliament's trade committee, said the tariffs were imbalanced and the hefty EU investment earmarked for the U.S. would likely come at the bloc's own expense. The euro rose around 0.2% against the dollar, sterling and yen within an hour of the deal's being announced. The deal mirrors key parts of the framework accord reached by the U.S. with Japan last week, but like that deal, it leaves many questions open, including tariff rates on spirits, a highly charged topic for many on both sides of the Atlantic. Carsten Nickel, deputy director of research at Teneo, said it was "merely a high-level, political agreement" that could not replace a carefully hammered-out trade deal: "This, in turn, creates the risk of different interpretations along the way, as seen immediately after the conclusion of the U.S.-Japan deal." "We are agreeing that the tariff ... for automobiles, and everything else will be a straight-across tariff of 15%," Trump said, but he quickly added that a 50% U.S. tariff on steel and aluminum will remain in place. Von der Leyen said that tariff would be cut and replaced with a quota system. Von der Leyen said the rate also applied to semiconductors and pharmaceuticals, and there would be no tariffs from either side on aircraft and aircraft parts, certain chemicals, certain generic drugs, semiconductor equipment, some agricultural products, natural resources, and critical raw materials. Trump appeared to suggest pharmaceuticals would not be covered, leaving some question about that aspect of the deal. No fact sheet was immediately issued by the White House. "We will keep working to add more products to this list," von der Leyen said, adding that spirits were still under discussion. Eric Winograd, chief economist at AllianceBernstein in New York, noted the similarity with Japan's U.S. deal. "We will need to see how long the sides stick to the deal. From a market perspective, it is reassuring in the sense that having a deal is better than not having a deal," he said. The deal will be sold as a triumph for Trump, who is seeking to reorder the global economy and reduce decades-old U.S. trade deficits, and has already reached similar framework accords with Britain, Japan, Indonesia and Vietnam, although his administration has not hit its goal of "90 deals in 90 days." He has periodically railed against the European Union, saying it was "formed to screw the United States" on trade. Arriving in Scotland, Trump said the EU wanted "to make a deal very badly" and said, as he met von der Leyen, that Europe had been "very unfair to the United States." Trump has fumed for years about the U.S. merchandise trade deficit with the EU, which in 2024 reached $235 billion, according to U.S. Census Bureau data. The EU points to the U.S. surplus in services, which it says partially redresses the balance. Now he argues, his tariffs are bringing in "hundreds of billions of dollars" of revenues for the U.S., while dismissing warnings from economists about the risk of inflation. On July 12, Trump threatened to apply a 30% tariff on imports from the EU starting on Aug. 1, after weeks of negotiations with the major U.S. trading partners failed to reach a comprehensive trade deal. The EU had prepared countertariffs on 93 billion euros ($109 billion) of U.S. goods in the event there was no deal, and Trump made good his 30% tariff threat. Some member states had also pushed for the bloc to use its most powerful trade weapon, the Anti-Coercion Instrument, to target U.S. services in the event of a no-deal.
The Mainichi
26 minutes ago
- The Mainichi
More Japanese consumers in Gunma Pref. turning to foreigner-owned shops for rice
An increasing number of Japanese consumers in Gunma Prefecture, which has one of the highest ratios of foreign residents per unit of population in the country, were seen turning to foreign-owned stores to buy imported rice amid high prices and shortages of the grain in early June. In the prefecture, many shops and convenience stores operated by individuals from Asia and South America offer rice from countries such as Thailand and India. Since the outbreak of a rice crisis last summer, more Japanese customers have apparently been purchasing these products. At Alh Mini Mart and Restaurant in the city of Tatebayashi, more than 10 varieties of rice from countries such as Thailand and Pakistan are sold. According to Aung Tin, a member of the Rohingya Muslim minority from Myanmar who manages the establishment, most buyers were initially foreigners from Myanmar and other countries, but the number of Japanese customers has increased since last year. California rice is also sold at this store. Not only is Japonica rice, commonly consumed by Japanese people, selling well at the store, but so is the long-grain Indica rice. The basmati variety is often used in biryani -- a dish where rice and meat are cooked with spices. Biryani is served at the restaurant attached to the store. Aung Tin shared a cooking tip, saying, "We layer cooked rice and ingredients in a commercial rice cooker and steam them. The key is to keep the rice firm when cooking." According to the Gunma Prefectural Government, as of the end of December 2024, there were 81,396 foreign residents in Gunma, accounting for 4.3% of the prefecture's population. This ratio is among the highest in Japan, alongside Tokyo and Aichi Prefecture. The increase in stores and restaurants run by Vietnamese and Nepalese people has made foreign rice more accessible. At the south exit of JR Maebashi Station, where Japanese language schools operate and students take buses to part-time jobs, the convenience store Chyandora sells jasmine rice produced in Thailand and Vietnam. While 70% of the customers are foreigners, roughly 30% are Japanese. Neupane Bhesham Raj, a Nepalese representative director, noted, "With the rise in rice prices in Japan, purchases by Japanese customers significantly increased." The Vietnamese Japonica rice is particularly popular among Japanese customers. "The taste is quite similar to Japanese rice," he said. Private imports also spiked. Beliatta Lanka Co., a wholesaler and retailer in Bando, Ibaraki Prefecture, imports rice for Chyandora. Beliatta Lanka pays a tariff of 341 yen (some $2.30) per kilogram for private imports. The company's Sri Lankan representative director stated, "The demand for foreign rice is increasing, and retail prices are also rising." (Japanese original by Tetsuya Shoji, Maebashi Bureau)
Asahi Shimbun
26 minutes ago
- Asahi Shimbun
The ups and downs of luring rich tourists to less-known areas
Operators of overseas travel agencies catering to wealthy clients observe a craftsman working at a Kaga Yuzen workshop in Kanazawa in February. (Yoko Masuda) Japanese areas that may not be household names among international tourists are increasingly appearing on the bucket lists of rich travelers. The efforts of government and tourism agencies to bring affluent visitors to Japan's lesser-known regions appear to be paying off. Luxury tour packages are consistently filled, and the visitors have no qualms about opening up their wallets to pour money into local economies. But questions about such tourism packages are being raised by local residents, many of whom say they are not feeling the benefits of hosting wealthy foreigners. Critics say efforts to cater to rich tourists have fueled increases in land prices that have driven out residents and created imbalances in local labor markets. INTO CULTURE The Japan National Tourism Organization (JNTO) is pitching lesser-known regions to travel agencies that curate trips to Japan for deep-pocketed clients. One such destination is Kanazawa, the capital of Ishikawa Prefecture. At a workshop nestled in residential district of Kanazawa, six foreigners watched kimono fabric being dyed in the traditional Kaga Yuzen technique passed down for centuries in the city. The visitors were all travel agency executives who flew to Japan in February at the JNTO's invitation. Gideon Nurick, a visitor who runs a travel agency in Vancouver, said Japan's attention to hygiene has heightened its popularity among travelers in the post-pandemic era. He said he will recommend Kanazawa to his customers. The JNTO started offering such inspection tours for foreign travel agencies in 2017. Although a tour to a dyeing workshop in Kanagawa costs 50,000 yen ($345) per visitor on average, hordes of international tourists have signed up, according to the Kanazawa City Tourism Association. 'Eighty percent of visitors to our workshop are from overseas, and the rest are Japanese officials in the kimono industry,' said Hitoshi Maida, a Kaga Yuzen craftsman who guided the inspection tour. Many of the tourists, he added, snap up pricy products sold at the workshop, such as glass panels sandwiching a piece of silk kimono cloth dyed in Kaga Yuzen style for display. A large one costs up to 2 million yen. GROWTH IN RICH TOURISTS Japan saw a record 36.87 million international arrivals in 2024, who spent a record high 8.14 trillion yen during their stay. The average per person was 227,000 yen. But some forked out several times more, and these are the tourists that the JNTO's program is targeting. An affluent visitor is defined as someone who spends at least 1 million yen during the stay in Japan. According to a JNTO study in 2023, affluent visitors accounted for only 2.4 percent of all foreign tourists, but their consumption represented 19.1 percent of the total. McKinsey & Company Inc., a management consulting firm, expects tourism catering to the privileged to grow faster than other industries, citing a rise in the global population of people with $1 million in net assets. The Japanese government is focusing on bringing well-heeled tourists to local destinations to achieve its target of 15 trillion yen in tourism revenue by 2030. INFRASTRUCTURE DEMAND Big spending travelers feel discouraged from visiting areas with no five-star hotels or five-star services, according to the Japan Tourism Agency. Takehiro Okamoto, co-CEO of Tokyo-based travel agency Wondertrunk & Co., said high-quality infrastructure and services are a must for regional areas aiming to become destinations for prosperous travelers. 'No matter how charming local regions are, we cannot recommend visits to sites if the equivalent of five-star hotels and comfortable transportation are not available,' said Okamoto, whose agency arranges tailor-made tours for the super-rich via travel agents in the United States and Europe. He said its typical clients stay in exclusive hotels and travel in chauffeur-driven vehicles with a personal tour guide. They each spend about 3 million yen during their stay in Japan. Okamoto said his company's sales almost doubled in 2024 from a year earlier because of a surge in foreign tourists. The Japan Tourism Agency in 2023 and 2024 designated 14 locations as 'model' regional sites to attract affluent tourists. 'The economic benefit will be exceedingly high and contribute to the revitalization of the regional economy,' the agency said on its website. One of the model sites is the Setouchi region, which consists of seven prefectures, including Hyogo, Hiroshima and Kagawa, around the Seto Inland Sea. After the selection in 2023, Setouchi tourism officials attended the Monaco Yacht Show last year to better understand the type of tourism big spenders prefer. The officials' catchphrase now is that the rich can make a journey in the Seto Inland Sea on their large yacht. A trip on a luxury cruise ship has been popular in the region. The two-night, three-day cruise on the Guntu ship costs between 600,000 yen and 1 million yen per passenger. The cruises have been booked to capacity, according to the operator. One magnet in the region is Naoshima, a small island filled with museums and famed installations in Kagawa Prefecture. It has been called a 'modern art haven.' The number of tourists taking helicopter rides to Naoshima from Kyoto or Osaka is rising, according to local officials. At least eight upscale hotels, many of them using foreign capital, are expected to open in the region by the end of 2029, according to the Inland Sea, Setouchi Tourism Authority, a consortium of tourism companies from the seven prefectures. Among them is Mandarin Oriental in Takamatsu, Kagawa Prefecture, which is scheduled to open in 2027 with a spa and swimming pool. The room charge will start at around 80,000 yen. Another hotel with a quaint atmosphere is expected to open on Naoshima around the same time. Tourists to the Setouchi region provided 183.5 billion yen in revenue in 2024, up 45 percent from a year earlier, according to an estimate by the Inland Sea, Setouchi Tourism Authority. The figure is the highest since the organization began collecting such data in 2017. The average monthly wage in the lodging industry in the region was 250,000 yen in 2024, 23,000 yen higher than in 2018, the year before the coronavirus pandemic struck. The 2024 figure is lower than the national average of 269,000 yen for services industries. But the wage growth in the region's tourism-related sector is steeper than in other regions. A majority of locals are skeptical about whether promoting tourism will truly benefit their communities. In a 2024 questionnaire of residents in Setouchi, 44.2 percent said they felt the economic benefits of tourism, down about 4 percentage points year on year. The ratio of respondents who felt little or no economic upside from tourism stood at 55.7 percent. 'An increasing number of residents have begun to view foreign tourists, including higher spending travelers, in a negative light as they become more aware of the unfavorable aspects of overtourism that have cropped up in many parts of Japan,' said Hiroshi Sakamoto, senior managing director of the Inland Sea, Setouchi Tourism Authority. LABOR PITFALLS Yoshihiro Sataki, a professor of tourism policy at Josai International University in Chiba Prefecture, said hosting luxury accommodations in regional areas can put a strain on other sectors because job hunters will likely flock to the better-paying positions at upscale hotels. At Niseko, an internationally renowned ski resort in Hokkaido, a housekeeper at a luxury hotel could earn more than 2,000 yen an hour during high season, double the minimum wage for Hokkaido, in 2024. The trend of locals seeking jobs at high-end facilities makes it even more difficult for operators of nursing care centers and restaurants that are already suffering from chronic labor shortages. In Kyoto, construction of luxury hotels has led to soaring land prices and higher housing costs for residents. The trend has had disastrous consequences for the ancient capital. More Japanese residents moved out of Kyoto than from any other Japanese city for three straight years from 2020. The exodus included many families raising young children. Toshiya Miyazaki, chief researcher with Mitsubishi Research Institute who is well-versed in tourism policy, said focusing on big spenders can help the local economy, given their strong interest in the traditions and cultural heritage of their destinations. 'If they purchase expensive classical handicrafts of local regions that average Japanese cannot afford, it will contribute to the preservation of the traditional craft industry,' he said. But he warned against overreliance on tourism. He said while Nara Prefecture is widely seen as a heavily tourism-oriented prefecture, its tourism industry makes up less than 10 percent of the overall amount of local banks' outstanding loans. 'Relying on tourism as the largest single source of revenue is a wrong approach,' he said. 'A rise in higher-spending visitors alone will not be enough to bolster the regional economy.'
