By Rocky Swift
Japan's broad Topix gauge of shares climbed for a sixth straight session on Monday as a decline in oil prices and positive momentum in global markets boosted investor sentiment.
The Topix TSE:TOPIX gained 0.50% to close at 4,084.74, marking its longest winning streak since August 2025. The benchmark Nikkei 225 TVC:NI225, which is heavily weighted by tech shares, struggled for direction, closing flat at 69,737.69.
Investors kept a cautious eye on the outlook for central bank policy, with the Federal Reserve signalling a hawkish stance under Chair Kevin Warsh, while the Bank of Japan is expected to continue tightening. Meanwhile, an increase in oil output targets and the reopening of the Strait of Hormuz provided some relief to markets.
The yen resumed its weakening trend, putting traders on guard for potential intervention by authorities in Tokyo, while Japanese government bonds (JGBs) fell sharply, with the benchmark 10-year yield rising to the highest since October 1996.
While Wall Street was closed on Friday for a holiday, Japanese equities took cues from strong performance in Europe and other overseas markets, said Maki Sawada, an equities strategist at Nomura Securities.
"These factors, combined with the downward trend in crude prices following OPEC+'s decision over the weekend to increase production, seem to be supporting investor sentiment," Sawada said. "Fluctuations in these AI and semiconductor-related shares will continue to influence whether the Nikkei 225 rises or falls."
The shipping, autos, and machinery sectors led gains in the broad market, with Toyota Motor TSE:7203 rising 3.36% and Mitsubishi Heavy Ind. TSE:7011 climbing 8.39%.
Tech industry suppliers led declines on the Nikkei. The largest losers were Taiyo Yuden TSE:6976, down 10.58%, followed by Ibiden TSE:4062, 8.37% lower, and Murata Manufacturing TSE:6981, which lost 7.49%.
There were 177 advancers on the Nikkei 225 against 48 decliners.