On July 24, the Tokyo market will see conflicting forces at play. The Nikkei 225 Stock Average rose 307 yen to close at 66,422.60 yen the previous day, supported by active share buybacks and the Tokyo Stock Exchange’s call for listed companies to enhance corporate value. However, all three major US indices fell in the prior session, and Nikkei 225 futures on the Chicago Mercantile Exchange (CME) plunged 935 yen to 65,395 yen, suggesting any rebound in Japanese equities may be limited.

Market sentiment remains weighed down by uncertainty over the Trump administration’s tariff policies and persistent concerns about China’s economic slowdown. Rising long-term US interest rates are also pressuring technology stocks. Adding to the cautious mood, July 24 marks a “PMI deluge,” with preliminary Purchasing Managers’ Index readings due from Japan, the US, and Europe, which is likely to keep many investors on the sidelines.

Bullish and Bearish Factors Collide

Key factors influencing the Tokyo market on July 24 present a mixed picture. On the positive side, the Nikkei’s gain in the previous cash session and the continued wave of corporate share buybacks provide support. The Tokyo Stock Exchange’s strong push for listed companies to improve corporate value is also fueling expectations for enhanced shareholder returns and better capital efficiency.

Bearish factors, however, are piling up. In the US market on July 23, the Dow Jones Industrial Average tumbled 506.93 points to 51,711.65, while the tech-heavy Nasdaq Composite slumped 553.21 points to 25,137.69. The Philadelphia Semiconductor Index (SOX), composed of semiconductor-related stocks, also fell 66.83 points to 12,343.84. Following this lead, Chicago Nikkei 225 futures, a benchmark for overnight trading on the Osaka Exchange, settled at 65,395 yen, down 935 yen and significantly below the cash market close.

External risks continue to simmer. Tariff policies pursued by the Trump administration remain a perceived threat to the earnings of export-oriented sectors such as automobiles and technology. Furthermore, entrenched concerns over China’s economic deceleration are reinforcing a cautious outlook on overseas revenues for Japanese companies. Rising long-term US interest rates are also making equities appear relatively expensive.

Key Indicator Rush Likely to Suppress Directional Conviction

A flurry of key economic indicators is scheduled for release both domestically and internationally on July 24. In Japan, June’s nationwide Consumer Price Index (CPI), foreign and domestic securities investment data, and preliminary July PMI readings for manufacturing, services, and the composite index are due. Overseas, preliminary July PMI figures from India, Germany, the Eurozone, and the US will be released all at once in a “PMI deluge.”

In the Eurozone, the European Central Bank (ECB) will release its June CPI forecast, while the Central Bank of Russia is scheduled to announce its policy interest rate decision. In the US, June new home sales data will also be published, drawing attention to housing market trends. These releases follow the ECB’s policy rate announcement and President Christine Lagarde’s press conference, as well as US initial jobless claims data, on July 23, meaning investors will be digesting those results while bracing for fresh indicators.

Market participants note: “Share buybacks and the TSE’s reform push are certainly underpinning the stock market, but uncertainty over external factors such as US interest rate trends, tariff risks, and China’s economic slowdown remains high. Depending on the content of today’s preliminary PMI readings, concerns over a global economic slowdown could intensify further.”

In the previous Tokyo session on July 23, the Nikkei 225 fell 116.59 yen to 66,115.60 yen, snapping its winning streak. While the Dow edged down just 6.06 points in the subsequent US session, the Nasdaq dropped 146.30 points, underscoring intensifying selling pressure on technology shares. Against this backdrop, the Tokyo market on July 24 is expected to see nervous, direction-seeking trading as bullish and bearish factors collide.