In this year's supplementary budget proposal, an additional issuance of 6.7 trillion yen in government bonds, as well as using the surplus tax revenues - according to sources.
November 28, 2024 15:50 JST (excerpt).
The surplus tax revenue used as a financial source is 3.8 trillion yen, also utilizing non-tax revenues and surplus funds from the previous fiscal year.
Approximately half of the total amount of 13.9 trillion yen depends on government bonds, posing challenges to fiscal health.
The supplementary budget proposal for the fiscal year 2024, which serves as a support for the comprehensive economic measures formulated by the government, is expected to have a general account total of 13 trillion 943.3 billion yen. It is planned to allocate the surplus tax revenue, which is expected to reach the highest level ever, to cover the shortfall, supplemented by an additional issuance of 6 trillion 690 billion yen in new government bonds, as revealed by multiple sources.
The government will finalize the supplementary budget proposal on the 29th and submit it to the extraordinary session of the Diet. The aim is to achieve early adoption before the end of the year. The total amount of economic measures-related expenses is estimated at 13 trillion 931 billion yen, with a reduction of 1 trillion 630.3 billion yen in specified expenses. On the revenue side, in addition to issuing additional government bonds, it is planned to utilize the expected surplus of tax revenue amounting to 3 trillion 827 billion yen, as well as non-tax revenue of 1 trillion 866.8 billion yen, and 1 trillion 559.5 billion yen from surplus funds of the previous fiscal year.
Breakdown of expenditures related to economic measures
Measures such as improving the wage environment contribute to the growth of the Japanese economy and regional economies...

In Japan's market conditions, the yen has reversed its decline, while speculation on narrowing interest rate differentials has slightly retreated, and semiconductor stocks have risen.
November 28, 2024 16:02 JST (excerpt)
In the Japanese market on the 28th, the yen exchange rate has suddenly fallen against the dollar. There is a reaction from the significant buying of the yen due to speculation on the narrowing interest rate differential between Japan and the USA. Semiconductor-related stocks were bought on expectations around the U.S. government's semiconductor regulations on China, leading to an increase in stock prices.
The Tokyo stock market, which had started to fall, turned into an uptrend. There is a possibility that the additional regulations on Chinese semiconductors by the United States will not be as strict as previously expected, leading to a sharp rise in semiconductor manufacturing equipment stocks such as Tokyo Electron and KOKUSAI ELECTRIC.
Bond market has risen. In addition to the decline in long-term interest rates in the United States, the results of government bond purchases were generally satisfactory and became a support factor for the market. According to the Tankan survey released by the Bank of Japan on April 1st, the Business Conditions Index (DI) for large manufacturing companies, which indicates the sentiment of the business environment, worsened by 2 points from the previous survey in December 2023 (plus 13) to plus 11. This is the first deterioration in 4 quarters. The sentiment of the related industries worsened due to a decrease in automobile production caused by quality control issues.The yen suddenly fell in the Japanese market conditions, with expectations of a narrowing interest rate spread slightly receding - semiconductor stocks rising.

[Market Eye] Stocks: The Nikkei average rebounded at the closing, with pessimism about China semiconductor regulations receding.
<15:31> The Nikkei average rebounded at the closing, with pessimism about China semiconductor regulations receding.
In the Tokyo stock market, the Nikkei average rebounded for the first time in three trading days to close at 38,349.06 yen, up 214.09 yen from the previous trading day. The market started weak due to concerns about the decline in US stocks, but later semiconductor-related stocks were bought back following some reports, pushing up the Nikkei average. Excessive pessimism about China's semiconductor regulations eased amid the Biden administration.
The dollar rebounded to around 151 yen at 3 p.m., and caution about market fluctuations continues even after the US holiday.
At 3 p.m., the dollar/yen is trading around 151 yen, with a slight increase in the dollar and a decrease in the yen from the late New York market the previous day. Ahead of the US holiday, the selling pressure on the dollar, which is thought to be due to position adjustments that strengthened in the overseas markets the previous day, eased. Market participants expressed caution about the possibility of price fluctuations in major central bank meetings scheduled for the following week.
[Market Eye] Interest Rates: Government bond futures rebound, long-term interest rates at 1.05%, supported by the decrease in US interest rates and Bank of Japan operations.
<15:08> Government bond futures rebound, long-term interest rates at 1.05%, supported by the decrease in US interest rates and Bank of Japan operations...

Petroleum futures are slightly down, with unexpected increase in US gasoline stocks.
November 28, 2024, 12:14 PM GMT+9
On the 28th in Asia time, petroleum futures prices are slightly down. Concerns are arising due to the unexpected increase in gasoline stocks in the USA.
At 0220 GMT (11:20 a.m. Japan time), North Sea Brent futures were 0.04 dollars (0.1%) lower at $72.79 per barrel. USA WTI futures were down 0.01 dollars at $68.71.
Expecting thin trading due to the US holiday.
According to the US Energy Information Administration (EIA) report released on the 27th, gasoline inventories for the week ending on the 22nd increased by 3.3 million barrels, contrary to expectations of a slight decrease ahead of the Thanksgiving travel season.
Although production cuts by the Organization of the Petroleum Exporting Countries (OPEC) and non-member oil-producing countries such as Russia under "OPEC Plus" have limited the decline, sluggish growth in fuel demand in major consumer countries like the USA and China has been weighing on crude oil prices this year.
According to two sources revealed on the 26th, OPEC Plus plans to reduce the voluntary production cuts by participating countries scheduled to start in January next year, ahead of the ministerial meeting on December 1st.

〔Market Eye〕Foreign exchange: The dollar rebounded to around 151 yen in the morning, easing some of the overbought levels. Mexican peso rebounded.
<12:05> The dollar rebounded to around 151 yen in the morning, easing some of the overbought levels. Mexican peso rebounded.
The dollar rebounded to around 151 yen in the morning. Trading associated with position adjustments ahead of Thanksgiving in the USA eased, resulting in the dollar being bought back, while the rebound of the Mexican peso and Canadian dollar was also noticeable.
Today's estimated range is 150.30-151.80 yen for the dollar/yen, and around 1.0500-1.0600 dollars for the euro/dollar.
In the previous day's overseas market, the dollar weakened across the board, while the yen strengthened across the board, leading to a significant decline in the dollar/yen exchange rate. From the mid-152 yen level at 3 p.m. the previous day, the market continued to decline, expanding the decline to 150.45 yen at one point, marking the lowest level in a month since October 21.
Although there are many items of interest, there is no decisive clue. The euro fell below the psychological barrier of 1.05 dollars on the 22nd, then rebounded. The yield of the U.S. 10-year Treasury, which has been rising since September, suddenly dropped from around 4.50% in mid-November. In the market, there is an adjustment in positions ahead of Thanksgiving in the USA.

[Market Eye] Interest rates: In the morning session, government bond futures rebounded, with long-term interest rates at 1.05%. Buying is dominant due to the decrease in US interest rates.
In the morning session, government bond futures rebounded, with long-term interest rates at 1.05%. Buying is dominant due to the decrease in US interest rates.
Government bond futures with the center limited to the December contract ended the morning trade higher at 142.99 yen, up 19 sen from the previous trading day. The yield on the newly issued 10-year government bond (long-term interest rate) decreased by 2.0 basis points to 1.050%. Against the backdrop of the previous day's fall in US interest rates, government bond futures are dominated by buying.
Government bond futures have been trading with a strong bias since the morning, following the trend of the previous day's US long-term interest rates falling to around 4.26%.
While reflecting the external environment, yen bonds have seen some buying back, but with a lingering expectation of higher interest rates in the background of the Bank of Japan's additional rate hike speculation, it is unlikely to be a situation where it is easy to buy on rallies for the time being, according to Masaru Suzuki, Senior Bond Strategist at Okasan Securities.
With the Thanksgiving holiday leading to the US market being closed, and with few market participants expected, overall trading is thin.

The US Federal Trade Commission has started an investigation into suspicions of monopoly in Microsoft's cloud and AI businesses, with the possibility of a policy shift under the new administration.
November 28, 2024
The US Federal Trade Commission (FTC) has initiated a comprehensive antitrust investigation into Microsoft's software licenses, cloud computing, cybersecurity, and AI businesses, under suspicion of violating antitrust laws (Japan's Antimonopoly Act). This investigation, approved by Chairwoman Lina Khan, has become uncertain due to the change in administration accompanying the inauguration of the next President, Donald Trump.
Focus and Background of the Investigation
The investigation by the FTC this time targets various aspects of Microsoft's business activities. The trigger for the investigation was a complaint from a competing company alleging that the company is unfairly leveraging the market power of its cloud service Azure. Of particular concern is the punitive licensing conditions imposed when customers try to migrate data to competing platforms.
The specific content of the investigation spans hundreds of pages...

The US government is ready to impose additional regulations on Chinese semiconductors as early as next week - sources.
November 28, 2024 11:41 JST (excerpt)
Changxin Storage Technology will not be added to the trade restriction list - significant differences from the previous proposal.
Measures based on negotiations with ally countries such as japan and the Netherlands.
The Biden administration is considering strengthening restrictions on the sale of semiconductor equipment and artificial intelligence (ai) memory semiconductors to china. Informed sources revealed. This will further tighten the grip on Chinese-made semiconductors by the usa, but will not lead to stricter measures than previously anticipated.
According to sources, this additional measure could be announced as early as next week. However, the timing and content of the regulations have been changed multiple times, and sources emphasized that nothing is confirmed until the announcement.
The planned new measures will be based on several months of discussions by US authorities, negotiations with ally countries such as japan and the Netherlands, and strong lobbying efforts by US semiconductor equipment manufacturers.
According to officials, the latest policy contains significant differences from the previous proposal regarding Chinese companies to be added to the trade restriction list...

The morning Nikkei average rebounded, with expectations of US semiconductor regulations triggering buying interest.
In the morning session of the Tokyo stock market, the Nikkei average rebounded to 38,295.13, up 160.16 yen from the previous trading day. Initially trading lower due to a decline in US stocks, the excessive caution stemming from speculation about US semiconductor regulations under the Biden administration eased, leading to induced buying.
The Nikkei average opened 199 yen lower, then extended its decline to around 330 yen lower at 37,801.62 yen. The decline in related domestic stocks, triggered by the fall in US high-tech stocks, pushed the index lower. However, after briefly falling below the psychological threshold of 38,000 yen, it quickly rebounded and transitioned to price movements around the threshold.
[Market Eye] Stocks: The morning Nikkei average rebounded, with expectations for US semiconductor regulations triggering buying.
<11:32> The morning Nikkei average rebounded, with expectations for US semiconductor regulations triggering buying.
In the morning session of the Tokyo stock market, the Nikkei average rebounded to 38,295.13, up 160.16 yen from the previous trading day. Initially trading lower due to a decline in US stocks, the excessive caution stemming from speculation about US semiconductor regulations under the Biden administration eased, leading to induced buying.
Japanese stocks turned higher, with semiconductor-related stocks surging - potential leniency in US regulations towards China2024年11月28...

Today's stock outlook = soft, with a negative sentiment towards falling US stocks and a stronger yen, value for money providing support.
November 28, 2024, 8:15 AM GMT+9
The Nikkei Stock Average is expected to show a soft trend in the Tokyo stock market today. It is anticipated that selling pressure will be fueled by the fall in the US stock market and the yen's appreciation. However, it is expected that bargain hunting will provide support at lower levels.
The estimated range for the Nikkei Average is between 37,700 yen and 38,100 yen.
The Nikkei Average is likely to be dominated by selling pressure as investors reacted negatively to the decline of the three major stock market indices, centered on high-tech stocks, in the US market. There is also a sense of caution in the US market as Thanksgiving approaches, which is believed to have led to profit-taking selling.
Japanese stocks are expected to fall for the third consecutive day, as investors are discouraged by the decline in US high-tech stocks and the strengthening yen, with a focus on export-related issues.
November 28, 2024 7:57 AM JST
On the 28th, the Tokyo stock market is expected to decline for the third consecutive day. Due to the decline in high-tech stocks in the US market ahead of the Thanksgiving holiday, there is a tendency for risk-averse selling to take precedence domestically. The yen is also strengthening in the foreign exchange market due to expectations of a narrowing interest rate differential between Japan and the USA with the December monetary policy decision, causing concerns about performance in export-related stocks such as automobiles, electronics, and machinery etc...