TOKYO - Nikkei stock prices soared on October 6th after Takaichi was elected as the new president of the Liberal Democratic Party (LDP), with the benchmark index surging more than 2,100 yen at one point and surpassing the 47,000 range for the first time in history.
Market participants expressed surprise at the leadership race outcome, with one observer commenting that "the result of the presidential election was unexpected," as share prices reacted sharply.
In morning trading, the Nikkei average finished at 47,835 yen, up 2,065 yen from the previous Friday’s close, marking its highest intraday level ever recorded.
"The Nikkei looks set to climb further — it’s the Takaichi trade," one investor remarked.
The broad rally was driven by expectations that the aggressive fiscal policy championed by new LDP president Takaichi will bolster Japan’s economy.
A weaker yen also helped push stocks higher, with the currency falling by about two yen from last weekend to just shy of the 150-yen mark against the dollar.
According to one market analyst, "the stock rally reflects expectations for change, but expansionary fiscal policies also carry potential downsides — the key will be whether a proper balance can be maintained."
Investors are now watching closely to see whether the market’s upward momentum will continue as the new party leader steers economic policy.
Source: TBS
