Tokyo Stock Market Hits Record High, Nikkei Surges

Tokyo, Japan – On September 11, the Nikkei 225 index continued its upward trend, closing at 44,372.50, up 534.83 points or 1.22% from the previous day. This marks the first time the index has surpassed the 44,000 mark. The rise was driven largely by an increase in major technology stocks and strong buying from foreign investors.

The surge follows a notable rise in the U.S. stock market, particularly in technology shares like Oracle, which saw a jump of 35.9% the previous day, significantly impacting investor sentiment in Japan.

Trading volume on the Tokyo Stock Exchange was robust, with 1.9 billion shares changing hands, reflecting a strong interest in artificial intelligence-related stocks and index futures. Analysts noted that surpassing the psychological barrier of 44,000 prompted a wave of short covering by traders.

“The expectations of a new government and fiscal measures contributed to positive investor sentiment,” said Naoki Fujiwara, Senior Fund Manager at Shinkin Asset Management. “However, there is a cautionary note about the overall high valuation levels.” Fujiwara highlighted that the price-to-earnings ratio (PER) for the Nikkei is around 18, indicating potential overvaluation.

Other analysts echoed these sentiments, suggesting that while the current trends are favorable, there are inherent risks, particularly with changing economic conditions in the U.S. and fluctuations in the global market.

The leading stocks that contributed to the Nikkei’s rise included SoftBank Group, which climbed over 9%, adding approximately 300 points to the index. A significant portion of the investment flow also went into semiconductor and cloud service-related companies, indicating a broadening interest among investors.

Despite the strong performance, some market participants remain wary about potential profit-taking, which could cause the index to retreat. “As we move forward, we should be cautious about short-term volatility,” said Takashi Hiroki, Chief Strategist at Monex Securities.