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BoJ kept rates unchanged and announced asset divestment
The Bank of Japan (BoJ) kept its benchmark interest rate unchanged but announced a significant divestment of risk assets. Japan’s benchmark Nikkei 225 index fell, while 10-year government-bond yields rose. Meanwhile, global equity markets were mixed as the initial lift from the Fed’s tone faded.
The BoJ kept its benchmark rate unchanged but surprised markets by announcing divestments in ETFs and REITs.
Global equity markets were mixed following the Fed’s initiation of monetary easing.
Nvidia announced a multi-billion-dollar investment in Intel, corresponding to approximately 4.5% of Intel’s total share capital.
The BoJ kept its rates unchanged and announces divestment of assets
The Bank of Japan (BoJ) kept its benchmark rate at 0.50% and surprised markets by announcing the divestment of risk assets. The decision involves annual sales of ¥330 billion in ETFs and ¥5 billion in REITs. While the decision to maintain the policy rate was unanimous, two members voted in favour of a 25 basis-point (bps) increase, suggesting that a more hawkish tone could begin to gain traction.
Concurrently, Japan’s latest inflation data showed a notable slowdown that may have informed the Policy Board’s decision to hold rates. Headline inflation eased to 2.7% year on year (from 3.1%). Core inflation excluding energy and food also slowed to 2.7% year on year (from 3.1%), broadly in line with the analyst consensus. Monthly data showed no material surprises.
Market reaction was measured: the yen was little changed against the US dollar (−0.04%); the Nikkei 225 fell 0.57%; and 10-year JGB yields rose 2.69% by the close, reflecting expectations that the market is beginning to price a higher probability of rate increases ahead.
U.S. equities extend gains; European markets face correction
Global equities delivered a mixed weekly performance after the Fed’s rate cut. In the US, the S&P 500 rose 1.27% on the week, the Dow Jones 0.53%, and the Nasdaq 100 2.67%, leading the major benchmarks. The Russell 2000 small-cap index advanced 1.44%. Sector-wise within the S&P 500, technology, financials, communication services, and consumer discretionary outperformed.
In Europe, indices ended the week slightly lower: France’s CAC 40 −0.19%, Spain’s IBEX −0.59%, and Germany’s DAX −0.58%. In Asia, the Nikkei 225 gained 3.01% week on week, while the FTSE China A50 fell 1.41%. In Latin America, Brazil’s Bovespa rose 2.45%, and Mexico’s IPC index closed up 0.69%.
New Wall Street highs after strategic alliance between Intel and Nvidia
Nvidia Corporation announced an investment in Intel of approximately US$5 billion in common stock, equating to around 4.5% of Intel’s total share capital. The companies also announced production collaboration across data-centre products, artificial-intelligence initiatives, and reciprocal chip supply arrangements.
Although a private-sector development, the move could have broader implications for the resilience of the US technology industry. Nvidia’s investment follows prior commitments from SoftBank Group and the US government, corresponding to roughly 2% and 10% of Intel’s share capital, respectively, reflecting efforts to secure competitive and comparative advantages amid persistent geopolitical frictions.
The Nvidia–Intel news likely supported the S&P 500’s weekly advance as semiconductor shares rallied broadly. Intel rose 22.84% on the week, while Nvidia closed down a modest 0.65%.
