Japanese Equities Break Records as Tech Surge and Trade Optimism Boost Market

Japanese stock markets climbed to historic highs on Tuesday, fueled by a sharp rally in technology shares and renewed optimism over U.S.–Japan trade relations. The Nikkei 225 ended the session at 42,849.67, its highest close on record, after briefly hitting an intraday peak of 42,999.71. The Topix index also reached a fresh all-time high at 3,067.96, underscoring the strength of the rally.

Technology companies led the advance. SoftBank Group surged nearly 7% amid reports that its PayPay digital payments arm could be preparing for a listing in the United States, a move that investors believe could unlock significant value. Semiconductor-related names also outperformed, with Advantest and Lasertec each gaining around 7%, supported by robust demand forecasts for AI-driven technologies.

The upbeat tone was reinforced by signs that Washington may be willing to review certain tariffs on Japanese exports. Such a step could ease pressure on Japan’s manufacturing and automotive sectors, both of which play a critical role in the country’s economy. Market participants said these trade developments helped bolster investor confidence and supported broad-based buying across sectors, from exporters to financials.

Despite the record-setting performance, recent data from the Tokyo Stock Exchange indicated that foreign investors were net sellers of Japanese equities last week, marking the first weekly outflow in almost four months. Analysts suggested that some overseas funds may be locking in profits after the market’s rapid gains.

Looking ahead, traders are awaiting Japan’s second-quarter GDP report and upcoming U.S. inflation data, both of which could influence monetary policy expectations and set the tone for market direction in the coming weeks.