Snapshot: The Nikkei 225 is trading at 66934, up 0.92% on the day, reaching a fresh record high. JGB yields are slightly higher, with the 10Y at 2.684%, suggesting continued confidence in the Japanese economic outlook.
- The Nikkei’s rally is heavily influenced by tech shares benefiting from the global AI infrastructure expansion, with SoftBank Group leading the charge.
- Watch for any signs of profit-taking after this significant rally; a pullback could be exacerbated by geopolitical tensions in the Middle East.
Bias into NY: We anticipate continued support for the Nikkei 225 as long as US yields remain contained; look for a test of the 67000 level. DXY strength may act as a slight headwind, but strong domestic momentum should prevail.