In the morning trading of the 28th, we want to pay attention to the following three points:

• Although there is a stalemate, the buying interest for dips remains strong. • Izumi's operating profit for February 24th decreased by 6.6% to 31.4 billion yen. • The focus of the morning session: Daihen, an unskilled welding system for thick plates with storage of 100 control data.

Japan's stock market on the 28th started with buying momentum, but is expected to become increasingly deadlocked. On the 27th, the US market showed increase with the Dow Jones Industrial Average up by 36 points and the Nasdaq up by 53 points. The outlook for Micron Technology was insufficient, causing skepticism about the sustainability of the artificial intelligence (AI) boom, leading to the decline of semiconductor stocks such as Nvidia. On the other hand, the large tech stocks such as Amazon.com and Apple, whose market capitalization reached 2 trillion dollars the day before, continued to be bought, supporting the market. Overall, the market continued to be cautious ahead of the announcement of the May Personal Consumption Expenditure (PCE) price index, which the Federal Reserve Board (FRB) places great importance on. The Chicago Nikkei Average Futures were up 160 yen from the Osaka session in the middle of the day, at 39,570 yen. The exchange rate is hovering around 160 yen and 70 sen per dollar.

Given the sandwiching between the Chicago futures, it's likely the buying momentum will prevail. Nikkei 225 futures were also seen buying up to 39,670 yen during the night session. While the Nikkei Average Stock Price yesterday turned out to be a backlash from the previous day's growth, there were some concerns that the overnight drop in Micron Technology could have an impact. Although Nvidia was sold, the impact on overall US semiconductor stocks was limited, and attention is likely to be focused on trending movements.

• Although there is a stalemate, the buying interest for dips remains strong.

Japan's stock market on the 28th started with buying momentum, but is expected to become increasingly deadlocked. On the 27th, the US market showed increase with the Dow Jones Industrial Average up by 36 points and the Nasdaq up by 53 points. The outlook for Micron Technology was insufficient, causing skepticism about the sustainability of the artificial intelligence (AI) boom, leading to the decline of semiconductor stocks such as Nvidia. On the other hand, the large tech stocks such as Amazon.com and Apple, whose market capitalization reached 2 trillion dollars the day before, continued to be bought, supporting the market. Overall, the market continued to be cautious ahead of the announcement of the May Personal Consumption Expenditure (PCE) price index, which the Federal Reserve Board (FRB) places great importance on. The Chicago Nikkei Average Futures were up 160 yen from the Osaka session in the middle of the day, at 39,570 yen. The exchange rate is hovering around 160 yen and 70 sen per dollar.

Given the sandwiching between the Chicago futures, it's likely the buying momentum will prevail. Nikkei 225 futures were also seen buying up to 39,670 yen during the night session. While the Nikkei Average Stock Price yesterday turned out to be a backlash from the previous day's growth, there were some concerns that the overnight drop in Micron Technology could have an impact. Although Nvidia was sold, the impact on overall US semiconductor stocks was limited, and attention is likely to be focused on trending movements.

Concerns about overheating were raised as the Nikkei Average Stock Price broke through +3σ of the Bollinger Bands on the 26th, but fell below +2σ in the previous day's adjustment, and overheating has been retracting. +2σ is hovering around 39,450 yen, so stability at this level is likely to be a focus. However, as the announcement of the Personal Consumption Expenditure (PCE) price index for May, which is important to the Federal Reserve Board (FRB), is expected tonight in the US, it is likely that the mood for observing the reaction of the US market after the announcement will increase. While it is unlikely that there will be a proactive buying trend, it is believed that there is strong buying interest among those looking to buy on dips.

It is likely that the rebound of tech stocks will be targeted as a search. Thanks to the solid performance of Arm Holdings, SoftBank G <9984> is expected to lead the Nikkei Average. In addition, during the more deadlocked times, funds for short-term value grabs targeting individual-owned small capital stocks may be directed. The Growth 250 Index, which had been lagging behind, had caught up with the 75-day moving average thanks to its growth the day before. If it is pushed up past this line, attention is likely to be focused on the 200-day moving average.

• Izumi's operating profit for February 24th decreased by 6.6% to 31.4 billion yen.

Izumi's <8273> business performance for the February 2024 period showed that operating revenue increased by 2.4% from the previous year to 471.166 billion yen, and operating profit decreased by 6.6% to 31.425 billion yen. In the retail business, due to the strengthening of the implementation of measures by improving product lineup and service provision in response to changes in individual consumer behavior, together with the return to occasion consumption such as outings, travel, and seasonal changes, sales trends have been doing well with the increasing number of visits to each business format, including the large commercial facility "Yume town."

Materials of concern in the morning session

• The NY Dow rose (39164.06, +36.26)

• The Nasdaq composite index rose (17858.68, +53.53)

- 1 dollar = 160.70-80 yen.

• The Chicago Nikkei futures were up (39,570, up 160 from Osaka)

• The VIX index was down (12.24, -0.31)

• US crude oil futures rose (81.74, +0.84)

Long-term US interest rates fell.

Expectations for inflation to ease in the US.

Request for improvement in corporate value by the Tokyo Stock Exchange.

Daihen's <6622> new welding system for thick plates achieves unskilled labor, storing 100 control data.

Softbank G <9984> to establish a new AI medical company in August, proposing treatment methods.

Rakuten G <4755> starts platinum band service for Rakuten Mobile, aiming for 10 million subscribers.

Aisin <7259> sold 200 billion yen of its shares to Toyota, Denso, and Toyota Industries.

North Etsu Corporation <3865> rejects the proposal to dismiss the current president, trust is placed in the current management.

Suzuki <7269> talks to employees about preventing further misconduct, preparing to adjust prices.

Soo-nichiro Uemura of Sojitsu <2768> promotes business model reform and deepening of business.

Marubeni <8002> invests 91.5 billion yen in US car leasing business, with a focus on management needs.

Honda <7267> fully upgrades the 'Freed' model for the first time in 8 years, achieving 20% improvement in gas mileage with HV.

Riken Keiki <7734> develops a portable device capable of detecting 3 types of toxic gases.

NEC Networks & System Integration <1973> focuses on cloud telephony, primarily on 'Zoom Phone'.

Fujitec <6406> delivers 44 elevators to high-rise office buildings in Hong Kong.

Obayashi Corporation <1802> reuses structural components for new construction.

Toho Gas <9533> operates a hydrogen plant in Chita, Aichi.

ENEOS HD <5020> adds JX Metal's Chilean copper mine stock to its sale, which will be sold to a Canadian company next month.

☆ Schedule of events in the morning session

08:30 Tokyo Core Consumer Price Index for June (YoY Forecast: +2.0%, May: +1.9%).

08:30 May Job Availability Index (Forecast: 1.26 times, April: 1.26 times).

08:30 May Unemployment Rate (Forecast: 2.6%, April: 2.6%).

08:50 May Mining and Manufacturing Production (MoM Forecast: +2.0%, April: -0.9%).

Not applicable.