Japanese Stocks Hit Record High After LDP Elects Pro-Business Leader
The Nikkei 225 surpassed 47,000 as investors cheered the Liberal Democratic Party naming Sanae Takaichi its leader, positioning her to be Japan’s first female prime minister.
Japanese equities surged to a historic high after the ruling Liberal Democratic Party selected Sanae Takaichi as its new leader, making her the likely next prime minister.
The Nikkei 225 closed up 4.75%, surpassing 47,000 points for the first time.
Takaichi, a former minister for economic security and internal affairs, advocates for increased fiscal stimulus and low borrowing costs, echoing the free-market ideals of Margaret Thatcher.
Markets rallied on expectations that her pro-business policies will benefit real estate, technology and heavy industry stocks.
However, the yen slid to record lows against the euro and declined 1.7% versus the dollar.
Japan economist Jesper Koll described it as a knee-jerk reaction as investors priced in her potential premiership.
While higher spending could boost growth, it may further weaken the yen amid rising public debt.
If confirmed later this month, Takaichi would be Japan’s first female prime minister, continuing the Abenomics agenda of her mentor, Shinzo Abe.
Her mandate will include finalising a US-Japan tariff deal and addressing a sluggish economy marked by rising living costs and stagnant wages.
With US President Donald Trump due to visit Japan, analysts expect Takaichi to seek a currency pact to strengthen the yen against the dollar.
Markets jumped on Takaichi’s LDP victory, driven by hopes of aggressive fiscal stimulus and economic reform.
This topic was reported by BBC News.
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