Japan's benchmark equity gauge jumped to record territory on Thursday as trading resumed following holiday closures, driven by upbeat technology earnings and encouraging signals from the Middle East that traders interpreted as lowering geopolitical risk.
The Nikkei 225 Index rallied 3.38% to reach an intraday high of 61,523.36. The Topix index rose 2.02% to 3,803.95.
Market participants noted a stronger yen compared with the last trading session on Friday, a move that followed episodes of suspected intervention by Tokyo aimed at supporting the currency. That currency dynamic factored into domestic market sentiment as investors digested overseas developments.
Wall Street benchmarks had recorded fresh highs overnight, a move in part fuelled by strong results from Advanced Micro Devices that stoked demand for companies tied to the fast-growing artificial intelligence segment. In parallel, diplomatic developments lifted risk sentiment: Iran said it was reviewing a U.S. proposal intended to end the more-than-two-month war, and U.S. President Donald Trump said Washington had held very good talks with Tehran.
Market context
- The surge in the Nikkei reflected both local and global drivers as investors reacted to corporate earnings in the technology sector and shifting geopolitical headlines.
- The Topix's advance signalled broader participation beyond headline large caps, with the market reopening after holiday interruptions.
Implications
The combination of technology earnings strength and tentative diplomatic progress in the Middle East helped underpin risk appetite across equities, while the yen's strengthening and indications of currency support by authorities added a domestic policy dimension to trading.
Trading remained sensitive to further developments on corporate earnings, forex moves and the diplomatic track between the U.S. and Iran, all of which could sway investor positioning in the near term.