Japan Bourse Likely To See Downward Correction

(RTTNews) - The Japanese stock market has moved higher in back-to-back sessions, accelerating more than 3,375 points or 7.5 percent along the way to a record closing high. The Nikkei 225 now sits just beneath the 47,950-point plateau although it may hand back some of those gains on Tuesday.

The global forecast for the Asian markets is mixed to lower, with support from the technology shares likely to limit the downside. The European markets were down and the U.S. bourses were mixed and the Asian markets figure to split the difference.

The Nikkei finished with huge gains on Monday after Sanae Takaichi was elected as the new leader of the ruling Liberal Democratic Party. Her anticipated agenda of aggressive government spending and loose monetary policy sent stocks surging across the board.

For the day, the index skyrocketed 2,175.26 points or 4.75 percent to finish at a record 47,944.76 after trading between 46,592.99 and 48,150.04. Among the actives, Nissan Motor gained 3.70 percent, while Mazda Motor jumped 4.03 percent, Toyota Motor soared 4.74 percent, Honda Motor accelerated 4.23 percent, Softbank Group rallied 4.10 percent, Mitsubishi UFJ Financial perked 0.13 percent, Mizuho Financial fell 0.21 percent, Sumitomo Mitsui Financial, Mitsubishi Electric skyrocketed 7.00 percent, Sony Group surged 6.80 percent, Panasonic Holdings climbed 1.94 percent and Hitachi spiked 4.09 percent.

The lead from Wall Street is soft as the major averages opened mixed on Monday and ultimately finished on opposite sides of the line and little changed,

The Dow shed 63.31 points or 0.14 percent to finish at 46,694.97, while the NASDAQ gained 161.16 points or 0.71 percent to end at a record 22,941.67 and the S&P 500 rose 24.49 points or 0.36 percent to close at 6,740.49, also a record.

The strength in the markets largely reflected a rally by semiconductor stocks, with the Philadelphia Semiconductor index surging by 2.9 percent to a record closing high.

Significant strength was also visible among gold and software stocks, while housing and commercial real estate stocks moved notably lower over the course of the session.

Meanwhile, traders continued to shrug off concerns about the economic impact of the ongoing government shutdown, which entered its sixth day amid little signs of progress toward a deal on a temporary spending bill.

Crude oil prices surged on Monday as OPEC's output increase for November turned out to be lower than expected and relieved concerns of oversupply. West Texas Intermediate crude for November delivery was up $0.73 or 1.20 percent at $61.61 per barrel.

Closer to home, Japan will see August numbers for household spending later this morning; spending is expected to rise 0.1 percent on month and 1.4 percent on year after climbing 1.7 percent on month and 1.4 percent on year in July.

Japan also will see preliminary August figures for its leading and coincident indexes; in July, they were up 1.1 percent on month and down 1.8 percent, respectively.