Japanese Bank Stocks Soar on Rising Yields and Rate Hike Bets

Japanese bank stocks surged on Friday as rising government bond yields and expectations of more interest rate hikes improved margins for local lenders.

The yield on 10-year Japanese government bonds hit a 30-year high due to growing concerns over inflation and interest rates, fueled by rising oil prices.

Bets on further rate hikes from the Bank of Japan also boosted Japanese banks, which are already trading up between 50% and 90% over the past 12 months.

Japan Post was a standout performer in the group, with its massive government bond book allowing it to earn more on reinvesting at higher yields.