Japan's Nikkei 225 stock index broke through 50,000 for the first time on October 27. Optimism stems from a U.S.-China trade agreement and domestic political shifts. Reports differ on the key drivers.
On Monday, October 27, the Nikkei 225 stock index rose 1.5% to open at 50,059.59 on the Tokyo Stock Exchange. This marked the first time the benchmark broke the psychological 50,000 barrier, following a mix of record-setting days and choppy trading in recent weeks.
According to The Japan Times, the rally followed a temporary framework trade agreement between the United States and China reached on Sunday in Kuala Lumpur. U.S. President Donald Trump is expected to meet Chinese President Xi Jinping in Seoul later this week. Forecasts suggest the U.S. Federal Reserve will cut rates again in its two-day policy meeting starting Tuesday, boosting hopes for cheaper money. Japan's benchmark index is up almost 30% over the past year.
In contrast, a Reuters report via The Japan News attributes the surge to euphoria over expected sizeable spending from Japan's new prime minister. The milestone comes amid a hot streak for the blue-chip gauge since fiscal dove Sanae Takaichi's ascent to power, continuing a run of successive records.
These perspectives highlight multifaceted market optimism, though views differ on the relative weight of trade developments versus domestic stimulus. Investors are watching the upcoming U.S.-China summit and Fed meeting closely.