Japan’s Nikkei Hits Unprecedented 47,944
(MENAFN) Japan’s Nikkei 225 index surged 4.75% on Monday to close at a record 47,944.76, marking its strongest single-day performance in months. The rally followed the election of Sanae Takaichi as the new leader of the ruling Liberal Democratic Party (LDP) over the weekend, a move that sets her on course to become the country’s first female prime minister.
Investors responded positively to expectations that Takaichi will continue Japan’s ultra-loose monetary policies. Her known support for fiscal expansion and a weaker yen fueled optimism that economic stimulus measures will persist, contributing to the bullish market sentiment. The yen weakened against the dollar, pushing the exchange rate above the 150 mark for the first time since early August.
The index's gains were led by strong performances in consumer cyclical, technology, and real estate stocks. Major industrials saw significant upswings, with Japan Steel Works gaining 14%, Yaskawa Electric Corp. rising more than 20%, and Kawasaki Heavy Industries and Mitsubishi Heavy Industries advancing 12% and 13%, respectively.
Takaichi’s election followed the September resignation announcement from outgoing Prime Minister Shigeru Ishiba. The LDP’s internal leadership contest featured five candidates, including Takaichi, former Agriculture Minister Shinjiro Koizumi, and Chief Cabinet Secretary Yoshimasa Hayashi. Takaichi ultimately secured victory in the second round of voting, positioning her to assume the role of prime minister in the coming days.
Market analysts are closely watching her next moves, particularly any signals regarding fiscal policy direction and the future stance of the Bank of Japan.
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