Japan's Nikkei Stock Average this week surpassed its all-time high of 38,915, a mark set 34 years ago, powered by semiconductor-related stocks as upbeat earnings results fueled optimism. Why has the blue-chip gauge risen so much, and how has Japan's stock market changed in recent years?
Japan's Nikkei Stock Average closes above 1989's all-time high
The benchmark index for the Tokyo Stock Exchange set an all-time high on Thursday, closing up 2.19% at 39,098. The Nikkei 225 closed above its previous all-time high of 38,915.87, set on Dec. 29, 1989, during the economic boom of the bubble era. The surge signals a possible end to the country's so-called lost decades. Read more.
Japan manufacturers' profits rise 20% on strong U.S. showing
One reason for the optimism in Japan's stock market is the record corporate earnings in the manufacturing sector. According to a Nikkei analysis, aggregate net profits for listed Japanese manufacturers grew more than 20% on the year for the April-to-December period, the first three quarters of the standard Japanese fiscal year. The auto industry was a major driver. Read more.
Tokyo bourse pressures CEOs with list of firms that are reforming
An improvement in corporate governance has also enhanced the appeal of investing in Japanese companies. Last month, the Tokyo Stock Exchange stepped up pressure on CEOs by releasing a list of companies that are meeting its request to improve capital efficiency metrics and stock prices. The TSE's move was the latest in a series of reform measures aimed at luring more investor capital. Read more.
Nvidia revenue more than triples as AI hits 'tipping point'
Just hours before Japan's stock market opened on Thursday, Nvidia announced blockbuster earnings, with quarterly revenue jumping 265%. The U.S. chipmaker also shared its bullish outlook, saying more revenue growth is expected in 2024. Soaring demand for chips powering artificial intelligence has underscored the strengths of the U.S. economy. Read more.
Foreign traders, Chinese fuel Japan's market rally in new year
Since the beginning of the year, global investors have piled into Japan, fueling the country's equity market. One fund manager said that a considerable chunk of foreign investors have rotated their investments out of China and the U.S. Experts say that many global investors new to Japan are using low-cost passive investments linked to the benchmark Nikkei Stock Average. Read more.
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