Home Business NewsBusiness Nikkei jumps as PM bows out, markets await US jobs numbers

Nikkei jumps as PM bows out, markets await US jobs numbers

by LLB Editor
3rd Sep 21 10:21 am

“MAhead of the all-important US jobs numbers, the big story of the day has been the Nikkei’s 2% surge after Prime Minister Yoshihide Suga confirmed he would not run for re-election, says Russ Mould, investment director at AJ Bell.

“He has been an unpopular leader and the country has struggled with the Covid vaccine rollout, leading to low levels of confidence among people in Japan.

“The market’s reaction to his announcement would suggest investors are optimistic that the country will find a stronger leader. Mining, healthcare, real estate and technology stocks all pushed forward on the main Japanese index.

“Today’s market surge has put the Nikkei back on a stronger path, with the index up nearly 7% year to date. That is still streets behind the US Nasdaq’s 21% gain over the same period, but better than the mere 2.3% gain from China’s SSE index.

“Later today investors will be watching like a hawk for the non-farm payroll data in the US which is expected to show employers hired 725,000 people in August.

“There is a fine line to walk for the result in terms of the potential market reaction. Significantly beating the figure could trouble investors as it would strengthen the argument for the Federal Reserve to start tapering its bond buying, thereby going down the path to withdraw support following the pandemic.

“But missing that forecast number could also trouble investors as it would suggest a slowdown in economic growth, which is something that’s been troubling other parts of the world including China.

“On the UK market, the FTSE 100 was flat at 7,170, with Barratt Developments the top riser.”

 

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