Japanese stocks closed at a new record high after market sentiment grew more optimistic. Investors now believe the US Fed will continue to cut interest rates after US inflation (CPI) data appeared more benign. This has led global markets to believe that high interest rate pressures will soon ease. Domestically, strong public support for the new Prime Minister, Sanae Takaichi, also helped boost risk appetite. The result: the Topix rose 1.7% to 3,325.05, and the Nikkei jumped 2.5% to 50,512.32—breaking through the psychological 50,000 level for the first time.

These gains were nearly uniform. All 33 subsectors on the Topix rose, with nonferrous metals and precision instruments leading the way. SoftBank Group shares surged around 6.7%, the largest contributor to the index's rise. Of the 1,671 stocks on the Topix, more than 1,400 rose, while only a small number declined. The defense and shipbuilding sectors also strengthened as the market hoped for industrial and defense cooperation to be discussed at the meeting between US President Donald Trump and Prime Minister Takaichi.

Politically, Takaichi entered with very high public confidence: a Nikkei survey showed his cabinet's support at around 74%. This is important because a high approval rating means he has room to implement his economic agenda, including policies to help the public cope with rising prices. Analysts also said the easing of US-China trade tensions has increased the market's sense of security. Some strategists have even discussed the next Nikkei target of 53,000–54,000, if the Japanese market's valuation continues to rise. (asd)

Source: Newsmaker.id