Japan Shares May Run Out Of Steam On Thursday

(RTTNews) - The Japanese stock market has climbed higher in back-to-back sessions, improving almost 600 points or 1.2 percent along the way. The Nikkei 225 now sits just above the 45,630-point plateau although the rally may stall on Thursday.

The global forecast for the Asian markets is soft, with technology shares expected to fall under pressure. The European markets were mixed and the U.S. bourses were down and the Asian markets figure to split the difference.

The Nikkei finished modestly higher on Wednesday as gains from the financial shares and technology stocks were capped by weakness from the automobile producers. For the day, the index gained 136.65 points or 0.30 percent to finish at 45,63.31 after trading between 45,205.47 and 45,693.28. Among the actives, Nissan Motor advanced 0.95 percent, while Mazda Motor tumbled 1.89 percent, Toyota Motor skidded 1.16 percent, Honda Motor slumped 1.05 percent, Softbank Group surged 5.97 percent, Mitsubishi UFJ Financial fell 0.32 percent, Mizuho Financial jumped 1.58 percent, Sumitomo Mitsui Financial collected 0.12 percent, Mitsubishi Electric improved 0.92 percent, Sony Group retreated 1.55 percent, Panasonic Holdings rallied 3.12 percent and Hitachi soared 4.76 percent.

The lead from Wall Street is weak as the major averages opened slightly higher on Wednesday but gradually turned lower and finished solidly in the red.

The Dow shed 171.50 points or 0.37 percent to finish at 46,121.28, while the NASDAQ lost 75.62 points or 0.33 percent to close at 22,497.86 and the S&P 500 sank 18.95 points or 0.28 percent to end at 6,637.97.

The extended pullback on Wall Street may have reflected uncertainty about the near-term outlook for the artificial intelligence trade following Tuesday's weakness.

AI darling and market leader Nvidia (NVDA) slid by 0.9 percent after tumbling by 2.8 percent on Tuesday, while fellow AI player Oracle (ORCL) slumped by 1.7 percent.

Concerns about valuations may also have continued to weigh on the markets after comments from Federal Reserve Chair Jerome Powell suggesting he believes stocks may be overvalued.

Crude oil prices soared on Wednesday due to the increasing likelihood of Russian oil exports facing heavy U.S. sanctions. West Texas Intermediate crude oil for November delivery was up $1.61 or 2.54 percent at $65.02 per barrel.

Closer to home, the Bank of Japan will release the minutes from its monetary policy meeting on July 30-31 later this morning. At the meeting, the BoJ maintained its interest rate and lifted its inflation outlook citing the rise in food prices. The policy board unanimously decided to hold the uncollateralized overnight call rate to remain at around 0.5 percent. Previously, the bank had raised the benchmark rate to the current level from 0.25 percent in January.

Japan also will see August data for producer prices, with forecasts suggesting no change on an annual basis at 2.9 percent.