Japan’s main stock market index, the Nikkei 225 index, has just exceeded its all-time high (ATH) that it reached 34 years earlier.
The Nikkei 225 index hit the mark above 39,000 on 22nd February as the chipmaker Nvidia's splendid market outlook led to chip-related stocks rallying on the charts.
Nikkei 225 is the index of the biggest Japanese companies.
In fact, Nvidia surpassed tech giants Alphabet (which owns Google) and Amazon in market capitalisation to emerge as the third largest US company. Nvidia recently reported strong earnings results.
The Nikkei has surged 17.5% since the beginning of the year, making it the world’s best-performing major index.
The Japanese market also gained due to international money inflow by traders who have abandoned the slowing Chinese market. In addition, there is domestic money inflow with households taking advantage of a new government subsidised savings scheme.
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In Tokyo, traders on the floors reported standing ovations, whoops and cheers. This is the highest-level Nikkei 225 hit, surpassing the mark of 38,915 that it reached on the final trading day of 1989 during the asset bubble.
At that point of time, 15 Japanese companies were ranked among the world’s 20 largest companies by market capitalisation.
Tokyo traders have referred to the 1989 peak as the "iron coffin lid," with its apparent unattainability being a symbol of the three and a half decades of economic stagnation that followed the implosion of Japan's stock and property bubbles.
The Japanese market has, however, yielded exciting results, surpassing the expectations.
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