Nikkei Update: Japanese Stocks Rally on Cooling US CPI DataJapan 225 CashIG:NIKKEINouzTraderNIKKEI Japanese Stocks Rally on Cooling US CPI Data The benchmark Nikkei 225 index surged 1.1% to break past the 68,000 level, while the broader Topix index jumped 1.0% to reach 4,180—with the latter officially setting an all-time high in the history of the Japanese capital market. "Smart money" across Asia-Pacific launched a massive buying spree following the release of US Consumer Price Index (CPI) data for July, which showed a cooling trend. This data effectively reduced the probability of a Federal Reserve interest rate hike in September to just 40% (down from 50%). Domestically, Japan's Producer Price Index (PPI) for July eased to 7.2% year-on-year (below the 7.4% estimate), demonstrating that domestic manufacturing input cost pressures are increasingly under control, thereby fostering a combination of very healthy corporate margins. -------------------------------------------------------------------------------------------------------------- ✅ Japan's Producer Price Index (PPI) Eases to 7.2% (Below 7.4% Projection) - Easing Manufacturing Input Costs: A Bank of Japan report confirmed that Japan's PPI for July slowed to 7.2% year-on-year (lower than June's 7.3% and the 7.4% consensus). - Corporate Margin Expansion: This decline in producer-level inflation provides concrete evidence that domestic industrial raw material costs are contained, bolstering the potential for net profit margin expansion among Japanese manufacturing and hardware companies in the third quarter of 2026. -------------------------------------------------------------------------------------------------------------- A massive wave of wholesale buying swept through major Tokyo-listed companies this afternoon: - 🔸Taiyo Yuden ($6976) and Murata Mfg (+7.4%): Leading the rally in the passive components sector, Taiyo Yuden surged 8.6% as both companies benefited from a spike in orders for multilayer ceramic capacitors (MLCCs) driven by global demand for AI servers and smart hardware. - 🔸Ibiden Co (+7.3%), Kioxia Holdings (+6.2%), and Advantest Corp (+5.3%): Advanced circuit board maker Ibiden, flash memory giant Kioxia, and chip testing equipment manufacturer Advantest all saw their shares soar amid an influx of foreign capital, validating the structural recovery of the hardware supply chain. - 🔸Mitsubishi UFJ Financial ($8306) +1.6% and Mizuho Financial (+1.7%): Major banking stocks posted steady gains, acting as a stabilizing anchor that secured a record high for the Topix index.