Japanese Stocks Regain Momentum in June, TOPIX Hits Record High

The Nikkei 225 index climbed 2.56% for the week and 2.85% over the month, while the broader TOPIX index notched a monthly gain of 1.34%.

TOPIX Reaches New Peak

The TOPIX even touched a record high of 2,821.21 during the month, though it closed slightly lower at 2,809.63 on Friday 28th. This upward momentum was somewhat tempered by mixed inflation data from Tokyo. Headline inflation rose, but underlying inflation remained subdued, nearing levels seen in late 2022. As Tokyo's inflation often foreshadows national trends, the data suggests minimal inflationary pressure.

Nikkei Volatility Retreats

The Nikkei Stock Average Volatility index, a gauge of market anxiety, dropped to a seven-month low of 16.13. This decline in volatility signifies a more stable market environment, boosting investor confidence.

Japan ETFs Soar

Mirroring the broader market gains, Japan-focused exchange-traded funds (ETFs) saw significant inflows. These ETFs collectively surged 2.35% over the week. The iShares MSCI Japan EUR Hedged UCITS ETF (IJPE) rose by 3.44%, while the Amundi MSCI Japan ESG Climate Net Zero Ambition CTB UCITS ETF (CJ1P) jumped 2.42%. Both ETFs benefited from the market rally and the positive outlook fueled by reduced volatility and a potentially stable inflation environment.

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Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.