SINGAPORE — Shares in Japan jumped on Friday after Prime Minister Yoshihide Suga said he will not be running in the upcoming leadership election.
The Nikkei 225 closed 2.05% higher at 29,128.11 while the Topix index finished the trading day 1.61% higher at 2,015.45. Japanese manufacturing stocks saw big gains, with Fanuc jumping 3.46% while JFE Holdings surged 6.49%.
The Japanese yen traded at 110.02 per dollar, still stronger than levels around 110.4 seen against the greenback earlier this week.
Suga bowing out of the leadership race for his party paves the way for a new prime minister. Suga has been under fire for his handling of the Covid situation in Japan, which included the hosting of the Tokyo Summer Olympic Games while the city was under a state of emergency.
“The cabinet approval rate has come down a lot and the Japanese people’s confidence has become much weaker,” Hiromichi Shirakawa, chief economist for Japan at Credit Suisse, told CNBC’s “Capital Connection” on Friday.
“Under the continuous state of emergency declaration and soft lockdowns, we haven’t yet seen light at the end of the tunnel,” Shirakawa said, adding that the next Japanese prime minister’s job is to restore the confidence of people who are “fairly exhausted,” rather than coming up with concrete economic fiscal policy.
TICKER COMPANY NAME PRICE CHANGE %CHANGE
.N225 Nikkei 225 Index NIKKEI 29128.11 584.60 2.05
.HSI Hang Seng Index HSI 25903.60 -186.83 -0.72
.AXJO S&P/ASX 200 ASX 200 7522.90 37.20 0.50
.SSEC Shanghai SHANGHAI 3581.73 -15.31 -0.43
.KS11 KOSPI Index KOSPI 3201.06 25.21 0.79
.FTFCNBCA CNBC 100 ASIA IDX CNBC 100 10459.57 56.84 0.55
Elsewhere, mainland Chinese stocks were lower, with the Shanghai composite down 0.55% while the Shenzhen component slipped 0.769%.
The Caixin/Markit services Purchasing Managers’ Index came in at 46.7, against July’s reading of 54.9. Earlier this week, the official non-manufacturing PMI for August showed contraction in the sector for the first time since early 2020.
PMI readings above 50 represent expansion, while those below that level signal contraction. PMI readings are sequential and represent month-on-month expansion or contractions.
Hong Kong’s Hang Seng index shed 0.89%. Hong Kong-listed shares of Alibaba fell more than 3% following reports that the firm is set to invest 100 billion yuan (about $15.5 billion) by 2025 for “common prosperity.”
South Korea’s Kospi climbed 0.84%. In Australia, the S&P/ASX 200 gained 0.5% to close at 7,522.90.
MSCI’s largest index of Asia-Pacific shares outside Japan rose 0.1%.
