Japan's Nikkei struggles for direction as investors await US CPI data

Japan's Nikkei share average remained unsteady on Wednesday while investors awaited the release of key US inflation data. The index was last up 0.06% at 67,011.66, oscillating between a 0.26% increase and a 0.35% decline. The broader Topix index gained 0.43% to 4,118.18. Analysts noted that traders were hesitant to make significant investments ahead of the US Consumer Price Index, which would provide insights into potential Federal Reserve interest rate adjustments.

Wataru Akiyama, an equities strategist at Nomura Securities, stated that investors were cautious as they evaluated whether the Federal Reserve might advance rate hikes. AI-related shares, which significantly impacted Japan's benchmark Nikkei index, saw mixed results. Lasertec, a semiconductor inspection equipment maker, experienced a 2.9% drop, while chemical and advanced materials company Resonac surged 6.73%.

Apart from the US and Iran's ongoing conflict, attacks on shipping were reported in both the US and Yemen. Iran's top security official claimed that the Strait of Hormuz, a crucial shipping route, would stay closed unless the US agrees to Iran's demands for ending the war. Among Tokyo Stock Exchange's 33 industry sub-indexes, Japan's mining sub-index surged 2.75%, marking the largest gain.

This rise coincided with a slight increase in oil prices, with Brent futures and US West Texas Intermediate crude trading near $80 a barrel. The Nikkei index exhibited positive breadth, with 122 advancers against 100 decliners and three unchanged. The largest percentage gainers included M3, up 9.88%, followed by Yokohama Rubber Company at 8.39%.

Conversely, the biggest percentage losers were Rakuten Group, down 11.62%, and Sumitomo Metal Mining, which fell 4.29%.