TOKYO — November 29, 2025
Tokyo’s stock market heads into the final month of the year in an uneasy but hopeful mood. On Friday, November 28, the Nikkei 225 eked out a modest gain and finished the week firmly higher, even as November goes into the books as the index’s worst performance for that month in more than a decade. [1]
At the same time, a major weekend headline — Micron’s plan to pour 1.5 trillion yen into a new AI memory chip plant in Hiroshima — underlines how Japan’s semiconductor ambitions and global artificial-intelligence spending are becoming an increasingly important pillar for Tokyo-listed stocks. [2]
Key takeaways for Nov 28–29, 2025
- Nikkei 225 closed Friday at 50,253.91, up about 0.2% on the day and 3.4% for the week, but down just over 4% for November — its worst November since 2011. [3]
- Topix finished at 3,378.44, gaining roughly 0.3% on Friday and also ending the week higher. [4]
- Friday’s advance was powered by hopes the U.S. Federal Reserve will cut rates in December and by solid local data on Tokyo inflation and housing. [5]
- Under the surface, investors rotated out of overheated AI and chip names and into machinery, industrial and infrastructure-linked stocks such as Okuma and Furukawa Electric. [6]
- On Saturday, November 29, Reuters reported Micron will invest about ¥1.5 trillion ($9.6 billion) in a Hiroshima plant to produce high‑bandwidth memory chips for AI, with up to ¥500 billion in Japanese government subsidies — a long‑term positive signal for Japan’s chip supply chain. [7]
- The Bank of Japan is openly preparing markets for a possible rate hike at its December 18–19 meeting, while the yen trades around ¥156 per dollar and Japanese government bond yields sit near multi‑decade highs. [8]
How Tokyo stocks traded on Friday, November 28, 2025
Friday was the last trading day of the month for the Tokyo Stock Exchange; the market is closed on Saturdays, including November 29. [9]
By the closing bell:
- Nikkei 225: 50,253.91 (+86.81 points, +0.17% vs Thursday) [10]
- Topix: 3,378.44 (+9.87 points, +0.29%) [11]
The moves look small, but they capped a meaningful recovery from mid‑month lows. From Wednesday’s strong rally through Friday’s close, the Nikkei rose roughly 3.4% for the week, even as it remained down just over 4% for November as a whole. [12]
Reuters data cited by The Economic Times show that advances comfortably outnumbered declines on the day, with 143 Nikkei constituents rising against 80 falling. [13] That breadth — modest index gains but broadly positive participation — fits with the idea that Tokyo’s market is rotating rather than capitulating.
Best and worst performers: machinery shines, select materials lag
Friday’s session in Tokyo continued a theme that has been building through late November: investors are dialling back exposure to the frothiest AI‑linked names and shifting money into more traditional cyclicals and value stocks. TS2 Tech
According to the Reuters breakdown carried by The Economic Times: [14]
- Top gainers on the Nikkei
- Okuma – The machine‑tool maker was the day’s biggest winner, climbing about 6.7% as traders bet that stronger global manufacturing and robust domestic capital expenditure will boost demand for factory automation equipment.
- Furukawa Electric – Shares rose roughly 4.7%, helped by expectations of sustained spending on power grids, EV components and communications infrastructure.
- Key losers
- Mitsui Mining & Smelting (Mitsui Kinzoku) fell about 2.1%.
- Toho Co. slipped roughly 2.0%.
Market commentary from TS2.tech, which synthesised reporting from AP, Xinhua and Reuters, noted that several AI‑exposed chip and electronics names, including Kioxia‑related plays and precision equipment makers such as Lasertec, spent parts of the session in the red before the broader market firmed into the close. TS2 Tech
The result: a “quiet rotation” day where index‑level gains were small, but the internal message was clear — machines, infrastructure, banks and other cyclical plays are back in favour; hyper‑growth AI franchises are being treated more cautiously.
Why the Nikkei rose even as November turned ugly
On the surface it might look contradictory: the Nikkei just logged its worst November since 2011, yet it finished the final week of the month on a strong note. [15]
Two main forces explain that tension:
1. Fed rate‑cut expectations are back in play
Throughout November, global equities were buffeted by fears that the AI boom had gone too far and by the economic drag from a prolonged U.S. government shutdown. Tech shares in particular suffered a sharp valuation check. [16]
In the final stretch of the month, however, investors started to focus on what comes next:
- Fed funds futures now imply roughly an 80–85% chance of a 25‑basis‑point U.S. rate cut in December, according to Reuters reporting based on CME FedWatch data. [17]
- In U.S. trading on Friday, all three major indices posted gains, and global risk assets generally found support from the idea that monetary policy could soon become more accommodative. [18]
Even with Wall Street shut on Thursday for Thanksgiving and trading volumes thin, this shift toward a “Fed cut” narrative helped anchor sentiment in Tokyo on Friday. Japanese investors know that a softer Fed typically means easier global financial conditions — a tailwind for export‑heavy markets like Japan’s.
2. Tokyo inflation and housing data support a “Goldilocks” view
Friday’s moves also came against the backdrop of better‑than‑expected domestic data:
- Tokyo’s core consumer price index (excluding fresh food) rose 2.8% in November from a year earlier, matching October’s pace and staying above the Bank of Japan’s 2% target. [19]
- Japan’s housing starts jumped 3.2% year‑on‑year in October, the first increase since March and a strong beat versus market expectations for a decline of around 5%. [20]
Inflation that is above but not accelerating out of control, paired with evidence that housing and construction activity are stabilising, supports the view that Japan’s economy is not rolling over — even as the BoJ edges toward tighter policy.
For equity traders, that combination looks close to “just right”: strong enough to justify earnings forecasts and capex, but not so hot that it forces an abrupt and aggressive rate‑hike cycle.
BoJ on the brink of another hike — and why that matters for stocks
The Bank of Japan’s December 18–19 meeting now looms as a critical event for the Tokyo market.
Two separate Reuters reports over the past week underline how much the central bank’s tone has changed: [21]
- In an exclusive piece, sources told Reuters that the BoJ is preparing markets for a possible rate hike as soon as next month, deliberately emphasising the inflationary risks of a weak yen and signalling that another move to lift the policy rate from its current 0.5% is firmly on the table. [22]
- Board member Asahi Noguchi publicly argued for “measured, step‑by‑step” rate increases, warning that keeping real interest rates too low could further weaken the yen and entrench elevated inflation. He also noted that Japan is making steady progress toward sustainable 2% inflation. [23]
A Reuters poll cited in those stories shows a slim majority of economists now expect the BoJ to hike at the December meeting, with consensus that the policy rate will reach 0.75% by March 2026. [24]
Yen and JGB yields: a tricky backdrop
While central‑bank watchers debate the timing, markets are already feeling the impact:
- The yen is trading around ¥156 per U.S. dollar, near a ten‑month low, even as Fed‑cut expectations rise. [25]
- 10‑year Japanese government bond (JGB) yields have climbed toward 1.8%, roughly the highest level in 17 years, while 30‑year yields are hovering a little above 3%, levels not seen in roughly a quarter century. [26]
This mix is double‑edged for equities:
- A weaker yen tends to support exporters — good news for automakers, machinery and other globally exposed Japanese companies.
- Higher long‑term yields, however, lift funding costs and the discount rate for future earnings. That generally benefits banks and insurers but is a headwind for “long‑duration” growth stocks, especially richly valued tech names.
Friday’s modest rise in both the Nikkei and Topix, despite the yield backdrop, suggests that equity investors are cautiously comfortable with a scenario of gradual BoJ normalisation, as long as the Fed is easing rather than tightening. TS2 Tech+1
Micron’s ¥1.5 trillion AI memory plant: the big weekend story
Although the Tokyo Stock Exchange was closed on Saturday, November 29, investors woke up to a major piece of corporate news that is likely to resonate in Monday’s trade and beyond.
According to a Reuters report published via Investing.com, Micron Technology plans to invest about ¥1.5 trillion (US$9.6 billion) to build a new high‑bandwidth memory (HBM) chip plant in Hiroshima, expanding an existing site. [27]
Key details from that report:
- Construction is expected to begin around May next year, with shipments of advanced HBM chips slated to start around 2028. [28]
- Japan’s Ministry of Economy, Trade and Industry (METI) is prepared to provide up to ¥500 billion in subsidies, underlining how central semiconductors have become to Japan’s industrial policy. [29]
- The expansion helps Micron diversify production away from Taiwan and compete more directly with SK Hynix, the current market leader in HBM chips used for AI accelerators and data‑center GPUs. [30]
For the Tokyo stock market, the direct impact on Monday’s session will likely show up in:
- Japanese equipment makers that supply chip‑fabrication tools and materials.
- Construction, engineering and local utilities with exposure to Hiroshima and the broader semiconductor investment boom.
- Domestic memory and AI‑hardware ecosystem firms, which could benefit from clustering effects and shared infrastructure.
More broadly, the deal reinforces a key structural theme for Japanese equities: Tokyo wants to regain a bigger role in the global semiconductor value chain, and it is willing to spend heavily to get there. That is supportive for the medium‑term narrative around Japan’s industrial and tech sectors, even if short‑term price action still depends on global risk appetite and rates.
Putting November in context: a rough month, not a broken story
Data from Morningstar and other market trackers show that the Nikkei 225 fell just over 4% in November, roughly 2,100 points, to end at 50,253.91 — its largest monthly point decline since early 2025 and its weakest November performance since 2011. [31]
Yet the index remains near historic highs and well above the 40,000 level that once seemed like a distant dream before Japan’s corporate‑governance reforms and the global AI rally. The late‑month stabilisation — capped by Friday’s gain — suggests that November was more of a valuation reset and policy scare than the start of a deep bear market.
Investors are now juggling three big narratives:
- Global AI and tech valuations
- Japan’s monetary‑policy turning point
- The end of negative rates and the prospect of a second BoJ hike mark the most significant shift in Japan’s rate environment in decades. [34]
- Markets now have to recalibrate which sectors benefit from higher yields (financials, insurers) versus which are most vulnerable (high‑multiple growth stocks, some REITs).
- Fiscal worries and bond‑market stress
- The jump in JGB yields has triggered headlines about a “scramble to sell Japan” and forced the new administration under Prime Minister Sanae Takaichi to repeatedly defend its large stimulus plans as “responsible.” [35]
- For equities, the key question is whether fiscal expansion plus gradual BoJ hikes can keep nominal growth strong without undermining confidence in Japan’s debt dynamics.
What Tokyo investors will watch next week
With November behind them, Tokyo traders head into December focused on a short but intense list of catalysts:
- Fed meeting and U.S. data
The Federal Reserve’s December decision — and its guidance on 2026— will heavily influence the yen, global risk appetite and the relative appeal of Japanese assets. Markets currently price in a high probability of a 25‑bp cut, but that could shift quickly on incoming data. [36] - BoJ communication ahead of December 18–19
Any speeches or interviews from Governor Kazuo Ueda or other board members will be parsed for signs that a December hike is more (or less) likely. Investors will also watch whether officials emphasise yen weakness or domestic demand risks. [37] - JGB auctions and yield moves
Upcoming 10‑year and 30‑year JGB sales will test investor appetite at higher yields. Weak demand could push yields even higher, pressuring rate‑sensitive sectors on the stock market. [38] - Follow‑through from Micron’s Hiroshima plan
Any additional detail from Micron or METI — such as supplier lists, technology roadmaps or final subsidy terms — will help traders refine their views on which Tokyo‑listed names stand to benefit most. [39]
What this means for investors (not investment advice)
For investors following the Tokyo stock market through Google News or Discover, the story of November 28–29, 2025 can be boiled down to this:
- The headline indices are proving resilient despite a difficult month, supported by Fed‑cut hopes and improving domestic data.
- Market leadership is changing, with industrials, financials and infrastructure‑linked names gaining at the expense of the most crowded AI trades.
- Policy risk is rising, but so too is policy clarity: both the Fed and the BoJ are now openly signalling their next moves, giving markets something concrete to price.
- And in the background, Japan’s semiconductor strategy — exemplified by Micron’s massive HBM investment — is quietly strengthening the long‑term case for parts of the Tokyo market, even as near‑term volatility remains elevated.
As always, this overview is for informational and news purposes only and does not constitute investment advice. Anyone considering exposure to Japanese equities should assess their own risk tolerance, time horizon and currency exposure, and consult a qualified adviser if needed.
References
1. m.economictimes.com, 2. m.investing.com, 3. m.economictimes.com, 4. english.news.cn, 5. m.economictimes.com, 6. m.economictimes.com, 7. m.investing.com, 8. www.reuters.com, 9. www.tradinghours.com, 10. english.news.cn, 11. english.news.cn, 12. m.economictimes.com, 13. m.economictimes.com, 14. m.economictimes.com, 15. m.economictimes.com, 16. www.reuters.com, 17. www.reuters.com, 18. www.reuters.com, 19. www.wral.com, 20. www.wral.com, 21. www.reuters.com, 22. www.reuters.com, 23. www.reuters.com, 24. www.reuters.com, 25. www.reuters.com, 26. www.reuters.com, 27. m.investing.com, 28. m.investing.com, 29. m.investing.com, 30. m.investing.com, 31. www.morningstar.com, 32. www.reuters.com, 33. m.investing.com, 34. www.reuters.com, 35. www.reuters.com, 36. www.reuters.com, 37. www.reuters.com, 38. www.reuters.com, 39. m.investing.com
