• Tokyo's stock market rebounded on Friday, November 15, ending a three-day losing streak for the Nikkei.
• A weaker yen boosted exporters, particularly automakers, and investors sought out undervalued shares.
• Banks also saw increased interest due to recent reports of higher profits and raised full-year profit outlooks.
• Despite gains, concerns about US economic policy under President-elect Donald Trump limited the upward trend.

Tokyo's stock market experienced a significant upturn on Friday, November 15, marking the end of a three-day losing streak for the benchmark Nikkei. Investors sought out undervalued shares, and a weaker yen bolstered exporters, particularly those in the automotive industry. This was a welcome relief for investors and market watchers alike.

The 225-issue Nikkei Stock Average, Japan's benchmark stock index, closed the day with a gain of 107.21 points, or 0.28 per cent, from Thursday, finishing at 38,642.91. This marked a significant recovery from the nearly 1,000-point loss the Nikkei had suffered over the previous three days.

Meanwhile, the broader Topix index also saw gains, finishing 10.42 points, or 0.39 per cent, higher at 2,711.64. This upward trend was driven by investors snapping up bargains in the wake of the Nikkei's recent losses.

Automakers and Banks Drive Market Recovery

Export-oriented automakers were among the biggest winners of the day, benefiting from the yen's weakness. A weaker domestic currency often boosts exporters as it makes their products more competitive in international markets. This was clearly the case in Tokyo on Friday, as automakers saw their stocks rise.

In addition to the automotive industry, banks and other financial institutions also saw increased interest from investors. This was largely due to the recent reports from three of Japan's megabanks, which showed higher profits for the April-September period and raised their full-year profit outlooks. This positive news undoubtedly contributed to the overall bullish sentiment in the market.

However, despite the day's gains, market watchers noted that the upward trend was somewhat limited in the afternoon. This was largely due to concerns about US economic policy under President-elect Donald Trump, who continues to announce his cabinet picks.

US Policy Concerns Limit Gains

The uncertainty surrounding the future direction of US policy has the potential to impact markets globally, and Tokyo was no exception. This is not the first time that political developments in the US have had a significant impact on international markets. Historically, presidential elections and changes in administration have often led to periods of uncertainty and volatility in global markets.

This is particularly true when the incoming administration represents a significant shift in policy direction, as is the case with President-elect Trump. Friday's market activity in Tokyo was a clear demonstration of the complex interplay of factors that can influence stock market performance.

From the impact of currency fluctuations on exporters to the influence of domestic financial performance and international political developments, it is clear that investors must navigate a complex and ever-changing landscape. However, as Friday's recovery shows, there are always opportunities for those who are willing to seek them out.