Japan’s Nikkei Stock Average Hits Record High; Bonds, Yen Drop on Stimulus Speculation

Reuters

12:27 JST, January 14, 2026

TOKYO, Jan 14 (Reuters) – Japanese stocks climbed to a record high on Wednesday, while the nation’s bonds and currency extended their declines as markets priced in the possibility of a snap election that could pave way for expanded fiscal stimulus.

A sharp yen decline since last week also provided a tailwind for equities, as the softer currency increases overseas earnings for Japan’s heavyweight exporters.

The Nikkei .N225 was up 1.5% at 54,364.54, as of 0206 GMT, crossing the key 54,000 mark for the first time.

The broader Topix .TOPX also hit an all-time high on Wednesday, rising 0.88% to 3,630.53.

The Nikkei jumped 3% to hit a record high on Tuesday following a media report that Prime Minister Sanae Takaichi might dissolve the parliament this month and call for a general election in February.

“The expectation for an early election continued to lift local stocks, while the weaker yen also boosted appetite for equities,” said Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory.

“But investors sold some stocks to book profits after the sharp gains in the previous session.”

The yen JPY= tumbled against the U.S. dollar on Tuesday to hit its weakest level since July 2024. The currency was last flat down 0.13% at 159.35 to the greenback, hovering near a level where the market expects a government intervention.

Heavy JGBs selloff extended into a second day, sending the yield on five-year bonds to a record high, ahead of an auction later in the day and growing concerns over debt-funded spending.

The 10-year JGB yield rose 2 bps to 2.180%, the highest since February 1999. Bond prices move inversely to yields.

Shares of chip-testing equipment maker Advantest 6857.T rose 5.16%, while chip-making equipment maker Tokyo Electron 8035.T climbed 2.36%. Uniqlo brand owner Fast Retailing 9983.T gained 4%.

Toyota Motor 7203.T edged 0.3% lower after jumping 7.5% in the previous session.

Shares of SoftBank Group 9984.T lost 4.74% to weigh the most in the Nikkei.