Record High for Japanese Stocks as Yen Falls Against Dollar After Sanai Takaichi's Victory
The Japanese Nikkei Index surged to a new record level of 56,083.14 points at the start of trading this Monday morning, marking an increase of 3.4%, following Prime Minister Sanai Takaichi's overwhelming victory in the general elections held yesterday, granting her a broad electoral mandate to revive the economy.
The broader Topix Index rose by 2.5% to reach 3,792.05 points, with Ozora Bank stocks leading the highest gainers at 2.7%, followed by Tokyo Gas and JFE Holdings.
The Japanese markets are experiencing unprecedented activity since Takaichi took office as Japan's first female Prime Minister last October, as her new economic policies have driven local stocks to record levels, while causing a sharp sell-off in government bonds and the yen.
In the cash market, the Japanese yen fell against the dollar to 157.95, marking its weakest level in two weeks, before stabilizing later at 157.1, which is nearly the same closing level as Friday.
This decline is part of a continuous wave of decreases for the yen since July 2024, despite some recovery due to speculation about official intervention to support the weak currency.
It is noteworthy that Takaichi's historic victory gives her the ability to proceed with wide-ranging economic reforms aimed at boosting growth and supporting local businesses, in a move described by experts as potentially shaking the foundations of the traditional Japanese economy and putting it on a new path.
