SoftBank Soars on Easing Rate Fears, But BOJ Hike Looms

SoftBank Group's stock surged more than 5% in Tokyo on Friday as technology shares rallied amid easing fears of another US interest-rate increase. This was accompanied by a 1.8% rise in the Nikkei 225 to 69,523.56.

The move followed softer-than-expected US producer-price data, which pushed the probability of a Federal Reserve rate increase in September down to about 35%. For SoftBank, whose valuation is increasingly tied to AI assets including Arm and OpenAI, easier US rate expectations are supportive.

However, investors are also becoming more confident that the Bank of Japan will tighten again in September, creating currency risk. This sensitivity has increased as Masayoshi Son concentrated the group around AI.

SoftBank's net asset value jumped from about ¥40 trillion at the end of March to ¥72.3 trillion at the end of June, helped by gains in Arm and Intel. July's market correction then pushed NAV back towards ¥58.3 trillion by August 5.