Japan’s stocks rebounded sharply on Tuesday after the Nikkei 225 and the Topix dropped over 12% in the previous session. Other Asia-Pacific markets were mostly higher.
In Japan, the Nikkei 225 index powered 3,217.04 points, or 10.2%, to 34,675.40, hitting its largest daily gain since October 2008 and highest ever spike in terms of index points.
The rallies in Japan saw both indexes climb back into positive territories for the year so far.
On July 30, the Bank of Japan had raised rates to their highest level since 2008, causing the yen to strengthen to a seven-month high, pressurizing stocks.
In Hong Kong, the Hang Seng index ditched 51.02 points, or 0.3%, to 16,647.34.
Japan’s heavyweight trading houses rebounded to close at gains of over 5%, with Mitsui up 10.43% and Softbank Group Corp jumping 12.06%.
Other sectors that saw rallies included Japanese automakers and semiconductor suppliers, such as Suzuki Motor and Renesas Electronics, which rose over 17.01% and 19.06%, respectively.
Japan’s June household spending numbers showed a larger-than-expected fall year over year, dropping 1.4% in real terms. The average monthly income per household was up 3.1% in real terms from the previous year.
Real wages in Japan also grew 1.1% in June compared to a year ago, the first time that wages have risen in 26 months. A strong wage growth offers more room to the Bank of Japan to tighten its monetary policy.
The yen weakened 1.45% to trade at 145.6 against the U.S. dollar.
South Korean markets had been halted temporarily on Monday after they fell 8%, triggering circuit breakers.
South Korean heavyweight Samsung Electronics rose 1.54%, while chipmaker SK Hynix climbed 4.87%.
The Reserve Bank of Australia decided to keep its cash rate steady at 4.35% on Tuesday, as expected by economists. The bank noted that inflation had remained above the midpoint of its target for 11 consecutive quarters and that the economic outlook for Australia remained uncertain.
The RBA also slightly upgraded its GDP growth forecast for the year ending December to 1.7% from 1.6% estimated in May. Meanwhile, CPI is now expected to come in lower at 3.0% for the year ending December compared to a prior expectation of 3.8%.
In other markets
In Shanghai, the CSI 300 slid 0.34 points to 3,342.98.
In Taiwan, the Taiex index took on 80.6 points, or 3.3%, to 20,501.02.
In Singapore, the Straits Times Index deleted 45.23 points, or 1.4%, to 3,198.44.
In Korea, the Kospi index gained 80.6 points, or 3.3%, to 2,522.15.
In New Zealand, the NZX 50 let go of 18.73 points, or 0.2%, to 12,245.77.
In Australia, the ASX 200 added 31.09 points, or 0.4%, to 7,680.64.
