Japan’s Nikkei hits record high on tariff relief, tech rally

Japanese markets, which resumed trade after Monday’s holiday closing, are also being fueled by speculation of more domestic stimulus which have brightened the nation’s economic outlook. Bloomberg

The Nikkei 225 Stock Average hit an all-time high on Tuesday as a relief over US tariffs continued to fan optimism over the nation’s economic outlook, while tech shares led the rally.

The blue-chip gauge climbed as much as 2.5% to 42,867.69, joining the Topix in surpassing July 2024 peaks. Chip-related names jumped after Micron Technology Inc. raised its sales outlook, while memory maker Kioxia Holdings Corp. posted strong results.

Japanese markets, which resumed trade after Monday’s holiday closing, are also being fueled by speculation of more domestic stimulus which have brightened the nation’s economic outlook.

Shares headed for a five-day gain after Japan’s top trade negotiator confirmed on Friday that US officials said Washington would end stacking of universal tariffs on the country and cut car levies as promised. President Donald Trump extended a pause of sky-high tariffs on Chinese goods for another 90 days.

“Japan avoided the worst case scenario,” said Toshiya Matsunami, chief analyst at Nissay Asset Management. “Of course the tariff is not positive in the longer term but at least in the short term, it was better than feared.”

The Nikkei, which has a heavy concentration of exporters including automakers and technology companies, has trailed the broader Topix this year as concerns around tariffs prompted investors to favor more domestic-driven stocks.

Although Japan has entered the “Obon” holiday period, Monday’s trading volume is on course to be more than 40% above the average over the past 20 sessions.

“Japan is a bit more of a known entity now on the tariff front,” said Tim Waterer, chief market analyst at KCM Trade. A deal with the US “offers some certainty for investors,” he said.