Japanese stock market hits record high as U.S. dollar weakens in Tokyo

On July 4th, Japan's stock market reached record highs as the weak yen persisted, with the Nikkei Stock Average closing at 40,913.65 points and the Topix index finishing at 35 years high. The U.S. dollar's decline in Japan contributed to this surge, surpassing the previous high set in March. The Japanese Finance Ministry's lack of intervention in the market has instilled a sense of security among investors, with the yen falling to its lowest point in over 37 years against the U.S. dollar. Market analysts attribute the strength of the Japanese market to gains in stocks and banks, attracting investors amidst rising long-term interest rates. This positive outlook has led to predictions of increased opportunities in the venture capital space. Meanwhile, the Pentagon's announcement of deploying advanced fighter jets in Japan as part of a modernization plan reflects growing tensions with China, North Korea, and Russia. The yen's continuous decline against major currencies, including the U.S. dollar and euro, has put pressure on market participants to anticipate potential intervention measures by Japan to stabilize the currency. Weak U.S. economic data, such as lower-than-expected private payrolls and increased jobless claims, have also influenced market dynamics, with expectations of a rate cut in September. The focus now shifts to the upcoming nonfarm payrolls report, which is projected to show an increase in jobs for June. Overall, the economic landscape remains volatile, with global factors impacting market trends and investor sentiment.