Japan’s Nikkei share average extended rally and surpassed the 50,000 level for the first time on Monday on expectations of a sizable spending from the nation’s new prime minister, a fiscal dove, Sanae Takaichi.
The Nikkei 225 Index rallied 2.17% to 50,367.38, taking its gains for the year to 25.8%. The broader Topix rose 1.72% to 3,325.82.
Among stocks, Kawasaki Heavy Industries share price jumped 7%, Advantest shares surged over 5%, Hoya Cor stock gained 6%, SoftBank Group shares gained over 4%, while Fast Retailing shares gained 2.55%.
Last week, Takaichi cleared a parliamentary vote to become premier. The Nikkei surged 3.6% for the week as Takaichi pledged a proactive spending policy, with an economic stimulus package expected to exceed 13.9 trillion yen ($92.2 billion), Reuters reported.
Takaichi is also expected to meet US President Donald Trump this week during his visit to Japan.
Meanwhile, the Bank of Japan will announce its monetary policy decision on Thursday. The central bank is widely expected to hold interest rates at its first meeting since Sanae Takaichi, an advocate of easy monetary policy, became prime minister.
Other Asian Markets
Asian markets rallied on Monday as hopes of a US-China trade deal improved investors’ risk-appetite in a strong start to a week that will be headlined by central bank meetings and megacap earnings.
That sent stocks sharply higher, with South Korea’s KOSPI and Japan’s Nikkei adding more than 2% each and crossing landmarks to record highs.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.3%. South Korea’s Kospi jumped 2.3%, while the Kosdaq rose 0.72%. Hong Kong’s Hang Seng Index gained 1%.
Will Indian Stock Market Follow Gains?
The Indian stock market is also expected to follow the rally in the global markets today. The trends on the Gift Nifty also indicate a positive start for the Indian stock market indices, Nifty 50 and Sensex.
Markets participants focus on the India–US trade deal, which could serve as the next major directional trigger, along with the ongoing Q2 results season.
“While the broader sentiment remains constructive, rising crude prices, stretched valuations, and profit-booking across select sectors suggest that investors are gradually turning cautious,” said Ponmudi R, CEO of Enrich Money.
On the technical front, Nifty 50 index has maintained strength above its critical support zone of 25,700 – 25,660, with 25,830 acting as an intraday pivot and 25,950 emerging as the key breakout level.
“A sustained close above 25,950 could trigger a sharp rally toward 26,200 – 26,400, while dips toward 25,600 are likely to attract fresh buying interest. Structurally, the earlier swing high of 25,660 now serves as firm support, keeping the broader setup bullish. However, the formation of a shooting star like candlestick pattern on the weekly chart indicates that momentum is slowing, and traders should watch for a follow-up candle to confirm any reversal,” said Ponmudi R.
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