The Nikkei 225 index climbed approximately 0.9% to surpass the 64,500 level during Thursday’s (Oct 29) trading session, marking its third consecutive day of gains. Market sentiment was bolstered after the Federal Reserve kept interest rates unchanged, in line with expectations, while technology stocks once again led the rally in the Japanese market.
The Fed maintained its current interest rates, even though two central bank officials dissented, favoring a hike. This decision has kept investors focused on the future direction of U.S. monetary policy—particularly as inflationary pressures remain a concern and the possibility of further tightening has not been entirely ruled out.
In the global technology sector, earnings reports from major companies yielded mixed results. Alphabet’s revenue fell short of market expectations, whereas Microsoft delivered a stronger-than-anticipated quarterly performance. These developments have prompted investors to remain selective regarding stocks tied to technology and artificial intelligence.
In Japan, technology stocks once again served as the primary driver of the gains. Kioxia surged by approximately 8%, Advantest rose 7.7%, and Ibiden climbed 5%. The financial sector also saw gains, with Mitsubishi UFJ and Mizuho Financial each rising 1.7%, while Sumitomo Mitsui added 1.4%.
Investor attention now shifts to the Bank of Japan’s (BOJ) upcoming policy decision. The BOJ is expected to keep interest rates steady, but the market will be looking for signals regarding a potential rate hike in December, given that inflationary pressures remain elevated. The tone of the BOJ’s policy stance will be a crucial factor for the movement of the yen and the sustainability of the Nikkei’s momentum.