Japanese Stocks Hit Record High Following Sanae Takagi's Election Victory

The Nikkei index surged to a new record of 56,083.14 points at the start of trading this Monday, marking a 3.4% increase following the decisive victory of Prime Minister Sanae Takagi in yesterday's general elections. This win provides her with a strong electoral mandate to rejuvenate the economy.

The broader Topix index also rose by 2.5%, reaching 3,792.05 points, with shares of Ozora Bank leading the gains at 2.7%, followed by Tokyo Gas and JFE Holdings.

Japanese markets are witnessing unprecedented activity since Takagi took office as Japan's first female prime minister last October. Her new economic policies have propelled local stocks to record heights while triggering significant sell-offs in government bonds and the yen.

In the foreign exchange market, the Japanese yen depreciated against the dollar to 157.95, marking its lowest level in two weeks, before later stabilizing at 157.1, approximately the same closing level as Friday.

This decline is part of a continuous trend since July 2024, despite some recovery driven by speculation about possible official intervention to support the weakening currency.

It is noteworthy that Takagi's historic victory empowers her to pursue extensive economic reforms aimed at fostering growth and supporting local businesses. Experts suggest these changes could significantly alter the traditional foundations of the Japanese economy and set it on a new trajectory.