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Japan’s Nikkei 225 jumps 2% as Prime Minister Suga bows out of governing party’s leadership race

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SINGAPORE — Shares in Japan jumped on Friday after Prime Minister Yoshihide Suga said he will not be running in the upcoming leadership election.

In afternoon trade, the Nikkei 225 surged 2% while the Topix index rose 1.68%. Japanese manufacturing stocks saw big gains, with Fanuc jumping 3.14% while JFE Holdings surged 6.08%.

The Japanese yen traded at 110.01 per dollar, still stronger than levels around 110.4 seen against the greenback earlier this week.

Suga bowing out of the leadership race for his party paves the way for a new prime minister. Suga has been under fire for his handling of the Covid situation in Japan, which included the hosting of the Tokyo Summer Olympic Games while the city was under a state of emergency.

Mainland Chinese stocks were lower, with the Shanghai composite down 0.15% while the Shenzhen component slipped 0.556%.

The Caixin/Markit services Purchasing Managers’ Index came in at 46.7, against July’s reading of 54.9. Earlier this week, the official non-manufacturing PMI for August showed contraction in the sector for the first time since early 2020.

PMI readings above 50 represent expansion, while those below that level signal contraction. PMI readings are sequential and represent month-on-month expansion or contractions.

Hong Kong’s Hang Seng index shed 0.54%. Hong Kong-listed shares of Alibaba fell more than 3% following reports that the firm is set to invest 100 billion yuan (about $15.5 billion) by 2025 for “common prosperity.”

South Korea’s Kospi climbed 0.78%. In Australia, the S&P/ASX 200 gained 0.55%.

MSCI’s largest index of Asia-Pacific shares outside Japan traded 0.2% higher.

Overnight stateside, the Dow Jones Industrial Average jumped 131.29 points to 35,443.82 while the S&P 500 advanced 0.28% to 4,536.95. The Nasdaq Composite edged 0.14% higher to 15,331.18.

Those gains on Wall Street came ahead of the U.S. employment report for August, set for release Friday at 8:30 a.m. ET.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 92.211 — off levels above 92.7 seen earlier in the week.

The Australian dollar changed hands at $0.7404 following its climb earlier in the week from below $0.732.

Oil prices were mixed in the afternoon of Asia trading hours, with international benchmark Brent crude futures was near the flatline, rising 0.03% to $73.05 per barrel. U.S. crude futures dipped 0.16% to $69.88 per barrel.

Japan’s Nikkei 225 jumps nearly 2% on reports that Prime Minister Suga is set to depart

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