The Nikkei index in Japan climbed to a historic new high on Friday (October 31), marking the largest monthly increase in 30 years. This surge came after strong sales expectations from Amazon and Apple boosted Asian tech stocks, propelling the Japanese stocks higher once again.
The weakening yen also lifted export-heavy companies with higher market capitalization. Earlier, Bank of Japan Governor Katsunobu Kato maintained a cautious tone on Thursday and kept interest rates unchanged, leading to the yen falling to a historic low against the euro and reaching its lowest point against the dollar since February this year.
On Friday, the Nikkei index closed up 2.1%, reaching a high of 52,411.34 points during the day, setting a new record high. This pushed the index to a 16.6% increase for the month of October, the largest monthly gain since January 1994.
The broader and more comprehensive TOPIX index also briefly rose by 1.4% to hit a historic high of 3,348.06 points, ultimately closing up by 0.9% at 3,331.83 points, setting a new closing record.
On Thursday, Amazon reported its cloud revenue growth at the fastest pace in nearly three years, helping the company provide sales outlook for the quarter above expectations. At the same time, Apple CEO Tim Cook exceeded Wall Street expectations for fourth-quarter iPhone sales and overall revenue forecast.
Japanese chip-related stocks were among the biggest winners. Socionext surged nearly 17%, while Advantest rose by 3.9% due to its significant weight, becoming the stock with the highest contribution to the Nikkei index points.
Stocks related to artificial intelligence (AI) centers also showed strong performance, with Hitachi soaring by 7.2%.
In recent months, driven by the global AI infrastructure boom, tech stocks have been a major driving force behind the continuous rise of the Nikkei index. This month, the Japanese stock market also benefited from the expectations of aggressive fiscal stimulus under the leadership of new Prime Minister Sanae Takii.
Naoya Oshikubo, an economist at Mitsubishi UFJ Financial Group, told Reuters that the Nikkei index surpassing 52,000 points is just “another step in its upward trajectory.”
“We have more room to grow, possibly another 10% by next April,” Oshikubo said. “This is not a bubble.”
(Translated and rephrased news article, references to Reuters reports)