Japan's Nikkei 225 index closed at a record 72,353.96 on Monday, climbing 1.55% after hitting an intraday high of 72,831, marking the first time the benchmark has crossed the 72,000-point threshold. According to reports from The Economic Times, the index touched a record intraday high of 72,269.64 during the session. The broader Topix index gained 1.24% to 4,095.05, demonstrating broad-based market strength across Japanese equities. The rally added more than ¥25.74 trillion ($156 billion) to the index's market value, as reported by analyst Bull Theory.
While stocks climbed to record highs, Japan's currency faced significant pressure, with the yen weakening to 161.7 per dollar, just short of the critical 161.96 level. As reported by The Economic Times, a break past that mark would leave the yen at its weakest point since 1986. The yen's decline persists despite Tokyo's efforts to halt it, with Japan spending a record ¥11.73 trillion ($73.4 billion) supporting the yen through late May. The Finance Ministry's reserve data showed the country's foreign securities holdings fell by $75.6 billion from April to the end of May, roughly matching the scale of Japan's latest intervention to defend the currency.
The market surge was primarily driven by enthusiastic AI investment sentiment that overshadowed concerns about US-Iran peace talks. As reported by The Economic Times, the rally was further supported by the Japanese government's ambitious plan to invest heavily in strategic sectors like AI and chips by 2040. The government plans to set a target of about 370 trillion yen ($2.29 trillion) in public and private investment in strategic sectors including AI and chips by 2040, according to the Nikkei report. The advance extended across Asian equities, with South Korea's KOSPI up 0.7% and China's SSE Composite Index climbing 1.78%.
Nonferrous metals led sectoral gains with a 7.57% increase, followed by electric appliances and glass & ceramics products, which rose 2.08% and 2.05% respectively. According to The Economic Times, there were 146 advancers against 75 decliners in the Nikkei 225, indicating strong market breadth. Real estate shares were among the laggards, declining 1.07% during the session.
J.Front Retailing led gainers with a 16.24% surge after activist investor 3D Investment Partners said it took a 5.10% stake in the department store operator. As reported by The Economic Times, Yaskawa Electric traded up 9.02%, while robot maker Fanuc gained 8.10%. The largest losers included Taiyo Yuden, down 3.37%, followed by Tokyo Electric Power, which declined 3.05%, and Obayashi, which lost 2.99%.
