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Japan's Nikkei 225 gained 0.7% by midday on August 25, lifted by tech stocks as investors cheered potential US interest rate cuts and shrugged off policy rifts with the Federal Reserve.
What does this mean?
Fresh hopes for US rate cuts lit a fire under Japan's markets, with technology shares leading the charge after Fed Chair Jerome Powell floated the idea at Jackson Hole. Standouts like SoftBank Group and chip equipment-maker Advantest spurred the Nikkei higher, echoing gains among semiconductor stocks globally. Elsewhere, TOTO shares jumped nearly 8% after the firm revealed a $224 million US plant -- a step to diversify away from Asian factories. Nidec saw a solid 6% lift too, while Terumo lagged behind after its $1.5 billion Organox acquisition was met with skepticism. Of the Nikkei's movers, 133 stocks rose and 90 fell, showing upbeat yet measured market sentiment.
Prospects of a US rate cut have sparked a rally in global tech and semiconductor names, making Japan's market one to watch. But the Bank of Japan's hints at possible rate hikes -- thanks to stronger wage growth -- add uncertainty. A stronger yen could squeeze exporters' profits, even as global investors ramp up their interest in Japanese equities.
The bigger picture: Policy pivots reshape global ambitions.
With central banks charting their own courses, Japanese firms are responding by ramping up US operations and pursuing deals abroad -- TOTO's new plant in Georgia and Terumo's overseas acquisition are just the latest examples. The interplay between Federal Reserve and Bank of Japan policies will be key for tech trends, trade flows, and investment decisions worldwide.