Asia-Pacific stocks were mixed Monday, Dec. 25, Japanese shares climbing for the second session.
The Nikkei 225 Index NIK of Japanese companies gained 0.3% to 33,254.03, while the Hong Kong Stock Exchange was closed.
China’s Shanghai Composite Index SHCOMP increased 0.1% to 2,918.81, while Singapore’s stock exchange was closed.
ADDING
Investing.com– Japanese and Indian stock markets were the top performers in Asia through 2023, with a dovish Bank of Japan and optimism over the Indian economy acting as key points of support.
On the other hand, Chinese blue-chip stocks were the worst performers in the region, as persistent concerns over an economic rebound in the country saw investors pivot out of local markets.
Japan’s Nikkei outperforms in 2023
The Nikkei 225 was by far the best performer in Asia for the year, and was set for an over 30% gain after surging to 33-year highs earlier in the year. The Nikkei was also among the top performing indexes among its global peers, with the S&P 500 rising about 24% in comparison.
A dovish BOJ was a main point of support for Japanese stocks, as the bank largely maintained its ultra-dovish policies of yield control and asset purchases. The BOJ also kept interest rates at negative levels for a seventh year running.
Low interest rates, especially as interest rates rose in the rest of the world, drew foreign investors into Japanese markets, with sectors such as real estate and technology seeing strong inflows.
A batch of strong earnings, particularly from Japanese automakers and major trading houses, also bolstered the Nikkei.
But whether the Nikkei could extend gains into 2024 remained in question, especially as the BOJ flagged an eventual end to its ultra-dovish policies in the coming year. The Japanese economy also faces increased headwinds from slowing export demand.