Tokyo’s shares recover from earlier losses on Thursday’s session

(MENAFN) Tokyo's stock market saw a significant rebound on Thursday, driven largely by a surge in auto stocks such as Toyota and Honda, following the recent depreciation of the yen. The benchmark Nikkei stock index, which comprises 225 major companies, surged by 2.79 percent, equivalent to an increase of 1,055.37 points, closing at 38,925.63. This closing marks the index's highest level in nearly two months, reflecting renewed investor confidence.

The yen's depreciation, which briefly hit 145 yen to the dollar, played a crucial role in fueling the buying frenzy for export-oriented auto stocks. A weaker yen generally benefits Japanese exporters by making their goods cheaper in foreign markets, thereby boosting their sales and profits. This positive sentiment was palpable across the market as investors capitalized on the favorable exchange rates.

In addition to the automotive sector, strong performances from semiconductor stocks in the U.S. stock market overnight also contributed to gains in Japan's semiconductor-related shares. Notably, stocks like Tokyo Electron saw robust buying, indicating a strong correlation between the performance of U.S. tech stocks and their Japanese counterparts. This trend highlights the interconnectedness of global markets and the influence of U.S. financial performance on investor behavior in Japan.

The broader TOPIX index also experienced an upswing, closing 70.62 points, or 2.66 percent, higher at 2,721.12. On the top-tier Prime Market, the advance-decline ratio was overwhelmingly positive, with advancing issues outnumbering decliners by a substantial margin of 1,580 to 56, while 9 issues remained unchanged. This broad-based rally suggests a general optimism among investors, reinforcing a bullish outlook for the Japanese stock market in the near term.

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