Risk appetite rebounds and strong earnings boost Nikkei Index to its largest weekly gain in weeks

Glonghui, February 3rd｜Driven by the stabilization of gold prices and optimism brought by strong earnings reports from the banking and technology sectors, market risk appetite has warmed up, with Japan's Nikkei 225 Index rising as much as 3.1%. The broader TOPIX Index also rose as much as 2.5%, with both benchmark indices recording their largest intraday gains since January 13. The technology and banking sectors were the main forces driving the indices higher. Mizuho Financial Group performed particularly well, with its share price surging as much as 5.6% after quarterly profits exceeded market expectations and the company announced an additional stock buyback. Other lenders, such as Mitsubishi UFJ Financial Group, also performed strongly. Andrew Jackson, Japan equity strategist at Ortus Advisors, wrote in a report that as precious metal prices stabilize and the market recognizes US manufacturing data, investors are "shifting to a more aggressive risk-taking mode." Due to robust growth in new orders and output, US manufacturing activity in January unexpectedly recorded its fastest expansion since 2022. The "multiple positive factors" brought by the strength of US technology stocks on Monday also provided a boost to their Japanese counterparts on Tuesday.