The Nikkei average rebounded for the first time in three days, ending the morning session at 38,761.02 yen, up 39.36 yen (+0.10%) compared to the previous day (estimated volume 1 billion 80 million shares).

The U.S. stock market on the 13th was mixed. The Dow Inc rose by 47.21 dollars to 43,958.19 dollars, while the Nasdaq fell by 50.68 points to 19,230.73. The October Consumer Price Index (CPI) matched estimates, leading to a sense of relief and initial buying, which supported the market. Concurrently, due to the CPI results, expectations for additional rate cuts at the Federal Open Market Committee (FOMC) meeting in December increased, leading to a rise in the market. The Dow remained strong throughout the day, but the Nasdaq slowed and turned downward toward the end.

While U.S. stocks were mixed, the reaction to the previous day's significant decline drove high demand in the Tokyo market as trading began. There were moments when the Nikkei average recovered above 39,000 yen, but directional clarity remained lacking, and after initial buying, it consolidated around the previous day's closing levels. Meanwhile, the dollar index rose to 106.5 for the first time since November 1, 2023, continuing a strong dollar trend. The exchange rate accelerated to 155 yen 90 cents per dollar, further weakening the yen against the dollar, which provided support for export-related stocks.

With the news that investment fund Oasis held just over 5% shareholding, Mercari <4385> saw an increase. Mitsubishi Heavy <7011> and Sumitomo Mitsui Trust <8309> were bought based on positive reports from brokerages. The buying of wire stocks continued with Sumitomo Electric <5802> and Furukawa Electric <5801>. Additionally, Kubota <6326>, Sapporo HD <2501>, Fujitsu <6702>, Panasonnic HD <6752>, Kawasaki Heavy <7012>, and Fanuc Corp <6954> were also purchased.

On the other hand, Kansai Electric Power Co., Inc. <9503>, which announced a large public capital increase, saw a sharp decline, while 7 & i HD <3382>, which announced receiving a proposal for privatization from its founder and others, experienced a slight drop. Rakuten <4755>, which achieved its first operating profit after entering the mobile business in the July-September period of 2024, fluctuated in the negative territory after initial buying. Although Mitsukoshi Isetan <3099> reported strong performance for the April-September period of 2024, it was sold off due to a sense of exhaustion as it maintained its full-year earnings forecast. Additionally, TOPPAN Holdings <7911>, Sumitomo Pharma <4506>, Lasertec <6920>, and SUMCO <3436> also underperformed.

In terms of global sectors, nonferrous metals, wholesale, machinery, transportation equipment, and warehouse & transport related stocks rose, while electricity & gas, petroleum & coal, metal, land transportation, and retail sectors declined.

The Tokyo market in the afternoon may see the Nikkei average further decline around 2 PM as European investors begin to participate, given the continued strong caution towards the upcoming Trump administration. Meanwhile, today being the peak day for earnings reports could lead to an active flow of individual buying. In the timeframe before noon, Takasago Thermal Engineering <1969>, DIC <4631>, and Kyushu Financial Group <7180> are scheduled, followed by Oji Paper <3880> at 1 PM, Toei <9605> and Yokohama Rubbers <5101> at 2 PM, and at 3 PM, Sundrug <9989>, Credit Saison <8253>, Macromill <3978>, Japan Post <6178>, SMC <6273>, Kanpo Life Insurance <7181>, Japan Post Bank <7182>, Concordia <7186>, Akebono Brake <7238>, Ebara <6361>, T&D Holdings <8795>, Asahi <2502>, and Matsukiyo Cocokara <3088>.