Nikkei extends gains, ends morning session up 371 points at 66,227; early selling reversed by falling oil prices and lower rates — BigGo Finance

The Nikkei Stock Average extended its gains on the Tokyo stock market on August 26, finishing the morning session at 66,227.55, up 371.12 points from the previous day’s close. The index opened lower at 65,604.49, down 251.94 points, but falling crude oil futures prices and declining U.S. long-term interest rates prompted buybacks once the initial selling ran its course, lifting the index into positive territory. Trading volume was approximately 875.28 million shares.

U.S. stocks rose on August 25. The Dow Jones Industrial Average closed at 53,577.40, up 160.24 points, while the Nasdaq finished at 26,151.30, up 171.11 points. The absence of any announcement of immediate implementation of new sanctions by the Trump administration against Iran’s trading partners, along with reports that mediator countries were seeking to de-escalate tensions in the Iran conflict, was welcomed by investors as oil prices fell, pushing stocks higher after the open. While weak economic indicators—including the consumer confidence index and new home sales—briefly stalled the rally, buying driven by lower interest rates provided underlying support.

In the Tokyo market on August 26, despite the previous day’s U.S. stock gains, profit-taking emerged in some semiconductor-related names, and selling dominated immediately after the open. However, the continued decline in crude oil futures prices and U.S. long-term interest rates in overseas markets underpinned investor sentiment, and buybacks spread once the initial selling wave passed. The index recovered into positive territory by mid-morning and expanded its gains, holding near the 66,200 level into the lunch break.

Among individual stocks, Advantest (6857.T) was the top contributor to the index’s rise, followed by SoftBank Group (9984.T). Other gainers included Chugai Pharmaceutical (4519.T), Recruit Holdings (6098.T), Daiichi Sankyo (4568.T), Sony Group (6758.T), Sumitomo Metal Mining (5713.T), Daikin Industries (6367.T), Tokio Marine Holdings (8766.T), Otsuka Holdings (4578.T), Toyota Tsusho (8015.T), Bandai Namco Holdings (7832.T), Fujifilm Holdings (4901.T), Astellas Pharma (4503.T), and Suzuki Motor (7269.T).

On the downside, Tokyo Electron (8035.T), Kioxia Holdings (285A.T), Taiyo Yuden (6976.T), TDK (6762.T), Ibiden (4062.T), Lasertec (6920.T), Fujikura (5803.T), SCREEN Holdings (7735.T), Disco (6146.T), Shin-Etsu Chemical (4063.T), Murata Manufacturing (6981.T), Furukawa Electric (5801.T), HOYA (7741.T), and Honda Motor (7267.T) declined. While semiconductor-related stocks were notably weak, pharmaceutical and financial names provided the bulk of upward momentum for the index.

By sector, securities and commodity futures trading, pharmaceuticals, and banking gained, while shipping, oil and coal products, and metal products declined. Falling oil prices pressured oil-related and shipping stocks, while financial sector names such as banks and brokerages attracted buying on the back of lower interest rates.

In currency markets, the dollar-yen pair traded with a soft tone, with the dollar sliding from 159.26 yen to 158.88 yen during morning Tokyo trading on August 26. Concerns over further escalation in the Middle East eased, and NYMEX West Texas Intermediate (WTI) crude futures fell to the low-$80-per-barrel range. The euro-yen pair followed the dollar-yen lower, trading in a range of 185.45 to 185.91 yen.

On the economic data front, Japan’s July corporate services price index rose 3.6% year-on-year, accelerating from the previous reading of 3.2%. Australia’s July consumer price index rose 3.5% year-on-year, matching market expectations and decelerating from the prior 3.8%.

The Nikkei is expected to trade in a narrow range near highs in the afternoon session. The index’s recovery from a 251-point decline at the open into positive territory, with gains expanding through the morning, underscored the resilience of downside support. However, with the 75-day moving average situated around the 66,300 level acting as a resistance line, some market participants see limited near-term upside.

Investor attention is focused on Nvidia’s May-July quarter earnings, scheduled for release tonight U.S. time, and Fed Chair Warsh’s speech at the Jackson Hole Symposium on August 28. With some investors opting to hold off on aggressive buying until these key events are digested, the afternoon session will likely see the market tracking crude oil futures and U.S. long-term interest rates while testing whether the upward momentum can be sustained.

On the Tokyo Stock Exchange Prime Market, seven stocks—including Terra Drone (278A.T) and Silicon Studio (3907.T)—briefly hit their daily upper price limits. The Nikkei had closed at 65,856.43 on August 25, up 328.34 points, and the August 26 session extended that rebound into a second consecutive day of gains.