In the morning session of the 31st, attention should be paid to the following three points.

Pay attention to the rough price movements after the announcement of the monetary policy decision-making meeting.

TDK's operating profit in the first quarter increased by 120.0% to 57.8 billion yen.

Highlights of the morning session: Tokyo Century, 40 billion yen in data center, North American expansion, responding to AI demand.

Pay attention to the rough price movements after the announcement of the monetary policy decision-making meeting.

The Japanese stock market on the 31st should pay attention to the rough fluctuations after the Bank of Japan's monetary policy meeting results. On the 30th, the US market saw the Dow Jones Industrial Average rise by 203 points, while the Nasdaq fell by 222 points. Active trading was held back ahead of the Federal Open Market Committee (FOMC). Kanto sensitive stocks were bought due to expectations of a soft landing, as consumer confidence and June's Job Openings and Labor Turnover Survey (JOLTS) in the United States exceeded expectations. On the other hand, ahead of earnings announcements from large tech stocks, selling of high-tech stocks by investors with large holdings was prevalent. The Chicago Nikkei 225 futures settlement value was 38,105 yen, down 385 yen from Osaka. The yen is trading at around 152.80 yen against the dollar.

From the selling of soybeans through Chicago futures, it looks likely to start with selling. Microsoft, which announced its earnings after the trading session, was angered by Azure's slowdown and fell more than 5% in after-hours trading at one point. On the other hand, AMD is up nearly 8% as its expected revenue exceeded expectations. The mood seems to be to wait and see the earnings announcements of US high-tech stocks that are starting to take off.

In addition, in the morning session, there is likely to be a wait-and-see attitude as investors want to determine the results of the Bank of Japan meeting. In the foreign exchange market, the news of additional rate hikes caused the dollar to fluctuate around 152 yen. Therefore, initial movements after the announcement of the results may be greatly turbulent. In addition, Nvidia has fallen more than 7%, clearly breaking the support line of the 75-day moving average. As the adjustment phase of Nvidia intensifies, it is likely to become a heavy burden on high-tech stocks with significant index impact.

The Nikkei 225 futures fell as low as 37,890 yen in night trading. Amid the yen's appreciation, and as Israel reportedly bombed the Lebanese capital, geopolitical risks are being monitored. If the risk-aversion attitude becomes stronger, there is a possibility that selling due to readjustment of investor holdings may increase ahead of the Bank of Japan meeting results. In the midst of being easily swayed by buying and selling related to indices, the focus may shift to individual stocks with earnings as the basis. Three-S Trust <8309>, Carmate <7297>, Maas GHD <6419>, Ideal Science <6413>, Shimano <7309>, Hyper <3054>, Kissei Pharmaceutical <4547>, Corona <5909>, NEC <6701>, TDK <6762>, etc. are among the companies attracting attention, according to yesterday's announcement.

TDK's operating profit in the first quarter increased by 120.0% to 57.8 billion yen.

TDK <6762>'s business performance for the first quarter of the fiscal year ending March 2025, sales revenue increased by 3.1% year on year to 518.809 billion yen, and operating profit increased by 120% to 57.872 billion yen. It exceeded the consensus (about 41.5 billion yen). Operating profit was attributed to a significant depreciation of the yen, increased shipments of ICT products, rationalization, and the effects of structural reform carried out in the previous fiscal year. It also announced a stock split of one share to five shares based on September 30.

Materials of concern in the morning session

The Nikkei Average rose (38525.95, +57.32).

The NY Dow rose (40743.33, +203.40).

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.

Tokyo Century <8439> invests 40 billion yen in data centers, expands in North America, and responds to AI demand.

Furukawa <6474> adds models to collaborative robots, able to carry 12kg and move quickly.

NTT <9432> conducts collective AI verification for local governments to reproduce citizen participation discussions as a reference for policy making.

Daiwa House <1925> establishes two new refrigerated warehouses in Osaka Bay.

TDK <6762> establishes a new edge AI subsidiary in Singapore.

Rakuten Group <4755> and Japan Post will open an 'online smartphone consultation room' at 500 post offices throughout Japan.

Sojitz <2768> acquires US takeout sushi to integrate seafood processing expertise.

Toyota Motor <7203> sold 5.16 million vehicles in the first half of the year, a 4% decrease from the previous year. It maintains its position as the world's top automaker for the fifth consecutive year.

Koito Manufacturing <7276> will make SEPTA a subsidiary in the Jan-Mar quarter of next year to strengthen high-performance sensors.

Suzuki <7269> has opened its fifth biogas plant in India.

Mitsubishi Heavy Industries <7011> has been awarded the construction of Takahama Nuclear Power Plant to manufacture and replace reactor internals.

Hitachi Zosen <7004> has won approval from the Tokyo Metropolitan Sewerage Service for sewage sludge incineration power generation. It emits zero N2O at temperatures above 900°C.

Yaskawa Electric <6506> thoroughly automates and improves productivity with data visualization.

- Rohm <6963> releases 10 types of car MOSFETs with low on-resistance and low heat generation.

- KDDI <9433> expands the range of mutual complementary measures with NTT East for insecurity.

- GreenBee <3913> utilizes high-performance sensors for efficient inverter construction with Toda Construction.

- Kuraray <3405> reduces nonwoven fabric production and concentrates on melt blown materials.

- Toray Research supports the efficient development of semiconductor materials.

- Keio Electric Railway <9008> and Nomura Real Estate develop condominiums in front of Seiseki-Sakuragaoka Station.

- Mitsui Fudosan <8801> expands outlet in New Taipei, Taiwan; opening in November.

- Toho Gas <9533> sells natural gas for industrial use in Indonesia.

☆ Schedule of events in the morning session

- 8:50 June Mining and Industrial Production preliminary report (forecast for the previous month: -4.5%, May: +3.6%).

Bank of Japan concludes its financial policy meeting.

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- 10:30 July Manufacturing PMI for China (forecast: 49.4, June: 49.5).

- 10:30 July Non-Manufacturing PMI for China (forecast: 50.3, June: 50.5).

- 10:30 Australian Consumer Price Index for Q2 (YoY forecast: +3.8%, Q1: +3.6%).

- 10:30 Australian Consumer Price Index for June (YoY forecast: +3.8%, May: +4.0%).

- 10:30 Australian Retail Sales for June (MoM forecast: +0.2%, May: +0.6%).