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This past week marked a significant rebound for Japan's leading indexes — the Nikkei 225 $^N225 and Topix. The Japanese stock market saw strong gains, spurred by renewed optimism that the United States might soon reach fresh trade agreements with key partners, including Japan itself. Notably, this rally unfolded during the Easter holidays when most global markets operated with reduced activity.
A central catalyst for the gains was the prospect of a more conciliatory US trade policy. Recent statements by President Donald Trump and Italian Prime Minister Giorgia Meloni expressing hope for easing US–EU tensions boosted sentiment among market participants. Additionally, Trump signaled that further tariff hikes on Chinese goods might be coming to an end — a move that bolstered risk assets.
1. The Nikkei 225 soared to a two-week high of 34,758.97 points on Friday, closing up 1.03% at 34,730.28.
2. Broad-based gains were also seen in the Topix Index, which added 1.14% for the day, fuelled by renewed interest in large-cap stocks.
3. For the week, the Nikkei advanced 3.41% — its strongest performance since January 20 — snapping a three-week losing streak.
- Expectation of tangible progress in US–Japan trade discussions
- Potential de-escalation in US–China tariff uncertainty
- Constructive signals from US and EU leadership on trade relations
- Diminished global risks amid diplomatic outreach
- Technical rebound after a period of market weakness, reigniting demand for Japanese equities
Despite subdued trading elsewhere due to Easter holidays, Japan’s stock market distinguished itself with robust upward movement. This performance highlights the asset class's renewed appeal amid a landscape of worldwide uncertainty and shifting US trade policy expectations. Japanese equity indexes remain sensitive to external influences, and any move toward de-escalating tariff policies may serve as a significant catalyst for further growth.
Globally, investors continue to closely monitor developments out of Washington and the broader diplomatic climate. In the near term, the tone and substance of international negotiations are expected to be key drivers shaping market sentiment and portfolio allocations.
