BANGKOK (AP) — Japan’s benchmark Nikkei 225 surged Thursday to a record close of 40,913.65, leading markets in most of Asia higher.

Shares fell in Chinese markets, while U.S. futures edged higher.

Investors worldwide are keen to see the Federal Reserve cut rates that it has been keeping at two-decade highs to slow growth and tame inflation, and hopes have been reviving that price pressures are easing enough to make that possible.

The Nikkei 225 gained 0.8% to 40,913.65, with buying of automakers’ shares and other export oriented stocks pushing the benchmark to an all-time high.

Toyota Motor Corp.'s shares jumped 2% and Honda Motor Co. climbed 3%. Nissan Motor Corp. rallied 4.5% and shares in computer testing equipment maker Advantest Corp. gained 2.1%.

The Nikkei 225’s all-time high during intraday trading is 41,087.75, on March 22. Its previous record close was 40,888.43, also set on March 22.

Investors have piled into the Japanese market partly due to the cheapness of the Japanese yen, which is trading at 34-year lows against the dollar. A weak yen tends to push the profits of exporters higher when they are repatriated to Japan.

Changes in regulations on investment accounts have also boosted share purchases.

The Nikkei 225 index has gained 22.4% so far this year. The index surged in the late 1980s during Japan’s bubble economy, when asset prices soared. But it collapsed when that financial bubble imploded in early 1990 after hitting its earlier record of 38,915.87.

Elsewhere in Asia, Hong Kong’s Hang Seng recovered from early losses, rising 0.2% to 18,018.72, and the Shanghai Composite index shed 0.8% to 2,957.57.

Taiwan’s Taiex jumped 1.5% as chip maker and market heavyweight Taiwan Semiconductor Manufacturing Corp. gained 2.7%.

In Australia, the S&P/ASX 200 surged 1.2% to 7,831.80, while the Kospi in Seoul advanced 1.1% to 2,824.94.

Bangkok’s SET jumped 0.9%.

On Wednesday, U.S. stocks kept rising in a holiday-shortened session after weak reports on the economy kept the door open for possible cuts to interest rates.

U.S. markets will be closed Thursday for the Independence Day holiday.

On Wednesday, the S&P 500 rose 0.5% to set an all-time high for a second straight day and for the 33rd time this year. It closed at 5,537.02.

The Dow Jones Industrial Average dipped 0.1% to 39,308.00, and the Nasdaq composite gained 0.9% to 18,188.30.

Tesla again helped boost the market and rose 6.5% a day after reporting a milder drop in sales for the spring than analysts feared. It was one of the strongest forces pushing upward on the S&P 500, along with Nvidia. The darling of Wall Street’s rush into artificial-intelligence technology climbed 4.6% to bring the chip company’s gain for the year so far to 159%.

The action was stronger in the bond market, where Treasury yields slid following a flurry of reports that came in weaker than expected on both the job market and U.S. services companies.

That followed reports from earlier in the morning showing a slowing job market.

The hope on Wall Street is that the economy will soften by just enough to keep a lid on upward pressure on inflation, but not so much that it throws workers out of their jobs and triggers a recession.

A much more anticipated report will arrive on Friday, when the U.S. government will give its comprehensive update about how many workers employers added to their payrolls during June.

The yield on the 10-year Treasury dropped to 4.35% from 4.44% late Tuesday, a notable move for the bond market, and much of the slide came after the report on U.S. services businesses. It’s been generally sinking since April on hopes that inflation is slowing enough to get the Federal Reserve to lower its main interest rate from the highest level in more than two decades.

In other dealings, U.S. benchmark crude oil gave up 73 cents to $83.15 per barrel in electronic trading on the New York Mercantile Exchange.

Brent crude, the international standard, lost 67 cents to $86.67 per barrel.

The U.S. dollar fell to 161.44 Japanese yen, reflecting expectations that U.S. interest rate cuts might narrow the gap in rates with Japan, where the benchmark lending rate is near zero. It was at 161.67 late Wednesday.

The euro rose to $1.0792 from $1.0787.