Japanese stocks surge to year-end record

Keep knowledgeable with free updatesSimply signal as much as the Japanese enterprise & finance myFT Digest — delivered on to your inbox.Japanese shares have logged their highest ever year-end shut, pushed by know-how shares as traders guess on the substitute intelligence growth and Tokyo’s potential to face up to elevated geopolitical turbulence and commerce tensions.The Topix closed the ultimate session of 2025 at 3,408.97, up 23.68 per cent because the begin of January and marking the primary time that the broadest index of Japanese shares has ended a yr above 3,000 factors.The ultimate stage additionally closed out the third consecutive yr of sturdy will increase for the Topix, following positive factors of about 17 per cent in 2024 and 26.7 per cent in 2023. The Topix’s greatest performing inventory of the yr was Kioxia, the reminiscence chipmaker whose fortunes have been spectacularly boosted by AI and the anticipated demand for information storage. The corporate’s shares surged 540 per cent in 2025.The document end comes lower than two weeks after the Financial institution of Japan raised its coverage rate of interest to the very best stage in 30 years, as inflation accelerates.Some content material couldn’t load. Examine your web connection or browser settings.Rising inflation lay squarely behind the ousting of former prime minister Shigeru Ishiba and his alternative by Japan’s first feminine chief Sanae Takaichi in late October. Her plans for enormous stimulus spending and excessive approval scores have additionally buoyed markets. Defence tools producers have thrived as authorities spending has risen and regional safety issues have swirled. Main banking teams have additionally outperformed on expectations of additional rate of interest will increase in 2026.Within the gentle of a diplomatic spat between Japan and China, shares in Japanese corporations with excessive publicity to Chinese language shoppers, or producers battling ever extra aggressive Chinese language merchandise, had been a drag on the index.The closing efficiency of the Topix marks an enormous swing from earlier within the yr, when Donald Trump’s sudden announcement of “liberation day” tariffs triggered a heavy sell-off of Japan’s exporters. The Topix has rebounded by about 50 per cent since its yr low on April 7.RecommendedJapan was among the many first international locations to open formal talks with the US on the threatened 27.5 per cent tariffs, significantly to guard the nation’s automotive trade. Below the deal that got here into power in September and represented a significantly better final result than many traders had feared, the US will apply a baseline tariff of 15 per cent on most Japanese imports.Takeo Kamai, head of execution providers at CLSA Securities in Tokyo, mentioned: “Given the worldwide macro panorama heading into 2025 and all the drama that occurred all year long, this yr was one which traders’ pivoted from conventional metrics of investing and thrived in a ‘new regular’ setting.”The weak spot of the yen, at roughly the identical stage in opposition to the greenback because it started the yr, additionally helped Japanese exporters.