Tokyo stocks are expected to see buying concentrated in major issues on Tuesday despite mixed market views, with the benchmark Nikkei share average likely to extend its winning streak to a fourth session and continue scaling record highs. The index has surged more than 5,300 points over the past three sessions, stoking short-term overheating concerns and inviting profit-taking pressure. Nonetheless, the Nikkei is poised to maintain its upward momentum, underpinned by sustained global risk-on sentiment. While Wall Street was closed on Monday for the Memorial Day holiday, European markets posted broad gains on optimism surrounding progress in U.S.-Iran peace negotiations. A recent slide in crude oil prices also buoyed market sentiment. Germany's DAX climbed 2% and France's CAC 40 advanced 1.8%, leading a regional rally. The DAX cleared its May 6 recovery peak to reach its highest level in four and a half months since hitting an all-time high in mid-January, providing a positive cue for Tokyo shares. Although robust demand for AI and semiconductor-related shares persists alongside falling long-term interest rates, decliners outpaced gainers on Monday despite the Nikkei's massive surge of more than 1,800 points. The turnover ratio on the Prime Market hovered around 80% on Monday, helping alleviate broader market overheating concerns. The broader TOPIX also hit its first record high in nearly three months on Monday, turning investor focus toward the behavior of the NT ratio, which remains at elevated levels.

On Tuesday's domestic calendar, Japan will release April white goods shipments, the revised March Composite Index, core consumer price indicators, and the government's May Monthly Economic Report. Overseas data releases include the March U.S. Federal Housing Finance Agency (FHFA) House Price Index, the March S&P CoreLogic Case-Shiller Home Price Index, the May U.S. Consumer Confidence Index, and a U.S. two-year Treasury note auction.

Source: MINKABU PRESS

*Translated by generative AI. Click here for the original article.