World markets higher as Japan’s benchmark Nikkei 225 breaks 1989 record

WORLD MARKETS advanced and Japan’s Nikkei 225 share benchmark surged to an all-time high yesterday, bypassing its previous record set in December 1989.

Tokyo’s benchmark closed at 39,098.68 yesterday. Its previous record was 38,915.87, set just before Japan’s bubble economy collapsed in the early 1990s.

The future for the S&P 500 was up 1.1 per cent after Nvidia’s shares jumped 13.2 per cent in pre-market trading. The Dow’s future was up 0.3 per cent.

After markets closed on Wednesday, Nvidia reported earnings and revenue that handily beat Wall Street forecasts. The chipmaker’s revenue has tripled over the past year, thanks to a surge in investor enthusiasm over artificial intelligence.

In early European trading, Britain’s FTSE 100 was little changed, at 7,661.95. Germany’s DAX climbed 1.2 per cent to 17,320.23, and the CAC 40 in Paris rose 0.7 per cent to 7,869.99.

The Nikkei’s strong performance has been driven largely by strong buying by foreign investors, who account for the majority of trading volume on the Tokyo exchange.

Record gains in corporate earnings have enhanced the appeal of shares in Japanese companies. The weakness of the Japanese yen against the United States dollar has also attracted investors, despite prolonged weakness in the economy, which slipped back into a technical recession late last year

Elsewhere in Asia, most markets logged solid gains.

Chinese markets benefited from reports that stock exchanges in Shanghai and Shenzhen froze accounts of a major hedge fund after it dumped 2.57 billion yuan ($360 million) in shares in just one minute on Monday.

China also banned major institutional investors from selling equity holdings at the open and close of each trading day.

The moves appeared to encourage investors who have remained leery about earlier efforts to prop up the markets. The Shanghai Composite index gained 1.3 per cent to 2,988.36, and the Shenzhen Composite was also up 1.3 per cent.

Hong Kong’s Hang Seng climbed 1.5 per cent to 16,742.95.

Australia’s S&P/ASX 200 edged less than 0.1 per cent higher, to 7,611.20, while the Kospi in Seoul added 0.4 per cent to 2,664.27.

On Wednesday, stocks ended mostly higher on Wall Street after a listless day of trading with big technology stocks again acting as a heavy weight on the market.

The S&P 500 rose 0.1 per cent and the Dow Jones Industrial Average also eked out a 0.1 per cent gain after losing ground most of the day.

The technology-heavy Nasdaq composite fell 0.3 per cent.

Technology stocks drove much of the market’s rally that brought it to record highs just last week. The sector is also showing some of the strongest earnings growth. Lopsided contributions from some of the bigger companies in the sector, however, have raised questions about whether the gains were overdone.

The Federal Reserve released minutes from its latest meeting in January that showed most officials are worried about moving too fast to cut their benchmark interest. The central bank left the rate alone for the fourth time in a row at that meeting. Investors have all but lost hope that the central bank will cut rates at its March meeting and are looking for the first rate cut to come in June.

Investors have to wait until next week for another key update on inflation. That’s when the government will release its monthly report on personal consumption and expenses, the Fed’s preferred measure of inflation.

Separate measures for consumer and wholesale prices in January show that inflation didn’t cool as much as anticipated. That prompted investors to shift expectations for rate cuts from March to June. A weak report on retail sales added to the disappointing inflation data and raised concerns that stubborn inflation is inflicting more pain on consumers.

In other trading yesterday, US benchmark crude oil gained 34 cents to $78.25 a barrel. Brent crude, the international standard, rose 32 cents to $83.35 per barrel.

The US dollar was trading at 150.15 Japanese yen, down from 150.31 yen. The euro was at $1.0857, up from $1.0823.