Japan's Nikkei 225 index achieves new all-time high, leading Asian markets higher

In a remarkable surge, Japan's Nikkei 225 stock index reached a new record high of 40,913.65, surpassing its previous close set in March. The index rose by 0.8%, driven by strong buying of automaker and technology shares. This increase was part of a broader trend as major world markets also saw gains, with Germany's DAX and France's CAC 40 advancing in early European trading. The UK was in the midst of a parliamentary election, with expectations of the Labour Party coming to power. The market rally extended to the US, where the S&P 500 and Nasdaq hit fresh records, reflecting optimism about the economy softening just enough to curb inflation without triggering a recession. Meanwhile, the Dow Jones Industrial Average experienced a slight dip. The global market optimism was also reflected in the drop in the yield on the 10-year Treasury and the weakening of the US dollar against the Japanese yen due to expectations of interest rate cuts. Investors have been drawn to the Japanese market despite economic slowdowns, attracted by a weak yen and changes in investment regulations like tax-free options such as NISA accounts. The Nikkei 225's gains were supported by heavy buying of technology and export-oriented shares, with notable increases seen in companies like Mitsubishi Heavy Industries, Nissan Motor Co., and Toyota Motor Corp. The index's current performance marks a significant rebound from its collapse in the early 1990s after the burst of Japan's bubble economy. Overall, the market movements indicate a positive sentiment among investors, with hopes for economic stability and controlled inflation. The record highs in various global markets, including Japan's Nikkei 225, reflect a broader trend of optimism and confidence in the financial landscape despite ongoing economic challenges and uncertainties.