Tokyo shares rise as inflation fears ease and Fed rate hike odds drop

Tokyo shares climbed Monday as easing inflation concerns reduced the likelihood of another Federal Reserve rate hike. Japan's Nikkei 225 jumped 2.3% to 69,901.70, marking its first push above 70,000 points in three months. In contrast, Australia's S&P/ASX 200 and Hong Kong's Hang Seng saw little change, edging up less than 0.1% and remaining virtually unchanged, respectively. Trading was closed in Shanghai and South Korea due to national holidays.

Investors showed strong interest in artificial intelligence-related shares. In Japan, Tokyo Electron surged 5.2%, and SoftBank Group's shares rose 3.1%. Taiwan Semiconductor Manufacturing Co. (TSMC) also gained 3%. Last week, U.S. stocks finished near all-time highs after a positive jobs report eased inflation worries. The S&P 500 rose 0.7%, the Dow Jones added 0.5%, and the Nasdaq gained 1.2%.

The U.S. government reported that employers added 29,000 more jobs than they cut last month, a slowdown from August's net hiring rate of 133,000. This led markets to believe the Federal Reserve is less likely to raise its benchmark rate. The yield on the 10-year Treasury briefly dropped below 5.17% before bouncing back to 5.28%. In energy trading, U.S. crude lost 1.55% to $89.70 a barrel, and Brent crude declined 0.99% to $101.24.

In currency trading, the U.S. dollar fell to 157.76 Japanese yen from 157.83 yen. The euro cost $1.1189, down from $1.1257.