In the morning trading on the 26th, the following three points are worth noting.

Identifying the resilience of high-tech stocks while exploring dividend-oriented investment opportunities.

Japan Oracle, 1Q operating profit increased by 20.2% to 22.1 billion yen.

Key points of the morning session: Toyota Industries accelerates decarbonization in the UK, constructing a biogas plant.

Identifying the resilience of high-tech stocks while exploring dividend-oriented investment opportunities.

On the 26th, the Japanese stock market is expected to be aware of its resilience despite the deadlock after starting with buying. On the 25th, the US market saw the NY Dow fall by 293 points, while the Nasdaq rose by 7 points. There was also a scene where the upward revision of the OECD's global economic growth outlook was well received, but with the NY Dow hitting record highs for consecutive days, profit-taking sales became dominant afterwards. On the other hand, a corner of the semiconductor stocks was bought, and the Nasdaq index continued to rise slightly for the third day. The settlement price of Chicago Nikkei 225 futures was 320 yen higher than Osaka at 37,980 yen. The yen exchange rate is moving around 144.60 yen to the dollar.

The Nikkei average stock price is likely to start with buying as it moves closer to the Chicago futures. Although the NY Dow fell for the first time in 5 business days, Nvidia breaking through technical resistance levels with consecutive gains is expected to be a supportive factor. Additionally, Micron Technology, which announced its earnings after trading hours, has seen nearly a 15% increase in extended hours trading, likely leading to buying in high-impact index stocks such as Advantest <6857> into high-tech stocks.

The Nikkei 225 futures closed at 38,110 yen in the night session, having captured the 75-day moving average as a resistance level. If this line is clearly breached, there is a possibility of increased short-covering in the futures market and trading related to indices could push up the Nikkei average stock price. As the end of September approaches, there is also likely to be increased searching for dividend-oriented investments, leading to an awareness of the solid support on the downside. The 75-day moving average of the Nikkei average stock price is around 38,280 yen, and if it clears this level, there is a potential for a stronger bias towards the upside.

Tomorrow is the ex-dividend day, and the drop is estimated to be around 280 yen for the Nikkei average stock price. Therefore, if it ends around the 75-day moving average level, it is likely to keep the milestone of 38,000 yen considering the dividend drop, which is expected to brighten the sentiment. While there may be a stronger sense of deadlock after a round of buying, with a focus on gauging the resilience of high-tech stocks and the increased search for dividend-oriented investments. Additionally, Laser Tech <6920> has been observed with analyst downgrades, so it would be important to assess the resilience after a round of selling.

Japanese Oracle reported a 20.2% increase in 1Q operating profit to 22.1 billion yen.

Japan's Oracle Corp <4716> announced that its first quarter performance for the May 2025 period showed a revenue increase of 11.4% year-on-year to 63.915 billion yen, and an operating profit increase of 20.2% to 22.194 billion yen. It achieved record highs in revenue, operating profit, ordinary profit, and net profit for the first quarter. Operating profit exceeded the consensus (approximately 19.6 billion yen).

Materials of concern in the morning session

- The Nasdaq Composite Index rose (18,082.21, +7.68)

・1 dollar = 144.50-60 yen

・Chicago Nikkei Futures are rising (37980, Osaka daytime comparison +320)

・SOX Index is rising (5132.52, +40.75)

Expectations for inflation to ease in the US.

Active share buybacks

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

- Toyota Motor Corp <7203> accelerates decarbonization in UK, constructing a biogas plant.

- Asahi Kasei Corp <3407> to develop bio-derived proof of chemical raw materials, production history management system.

- SUBARU Corp unsponsored adr <7270> to nurture DX human resources, targeting thousands of office workers.

- Kansai Electric Power Co <9503> to provide zero-carbon electricity at Expo, including hydrogen-mixed combustion thermal power.

- Marubeni Corp <8002> participates in collective housing development in India, boosting post-sales in Pune.

ANAHD<9202> Flying car, commercial operation abandoned, limited to demonstration flights at the expo.

Hitachi<6501> Hitachi Energy to invest 22 billion yen in North America, enhancing manufacturing capacity.

TPR<6463> External sales of surface treatment technology for wear resistance and low friction.

OSG<6136> Accelerating M&A in diamond tooling, pioneering micro precision processing.

Hitachi Construction Machinery<6305> Collaborating with a US company to develop electric mini excavators.

Komatsu<6301> Developing medium-sized drill jumbo compatible with tunnel diameters exceeding 4.5m.

Misumi Group Headquarters<9962> Significantly shortening parts procurement time with AI, extracting manufacturing partners.

IIJ<3774> Training and placement support for talent, proposing solutions tailored to business characteristics.

Hitachi <6501> streamlines intellectual property analysis, introduces AI analysis and graph generation service to Toyota.

Mitsubishi Electric Corp. <6503> enables efficient reuse through practical operation of plastic selection using static electricity.

Shimizu Construction <1803> updates elevated bridge decks on highways with a self-propelled device, using new construction methods.

Mitsubishi Estate <8802> develops a mixed-use project in Sydney, utilizing a brewery to enhance residential and commercial zoning.

Kobe Steel <5406> promptly commercializes low-CO2 aluminum sheet products.

☆ Schedule of events in the morning session

・08:50 Bank of Japan Monetary Policy Meeting Minutes (July 30-31)

Not applicable.