Japan’s Topix gauge reaches a record high on declining debt concerns

Japan’s broad Topix gauge hit a record high on Friday as waning sovereign debt concerns gave stocks a tailwind. The Topix hit an all-time intraday high of 3,436.75 in early trading before losing some momentum to close down just ‌0.2% at ‌3,423.06. The blue-chip Nikkei index rose 0.7% to 50,750.39, posting a 2.5% gain for the week and on track for a 26% rise in 2025. The Cabinet on Friday approved a record budget for the next fiscal year, aiming to strike a balance between proactive fiscal policy and debt management.

Japanese government bonds (JGBs) rose slightly as expectations for limited debt issuance caused yields to retreat from a 26-year peak. The recovery in Japanese government bonds came as Prime Minister Sanae Takaichi sought to allay concerns about her massive stimulus plan, with the government likely to scale back new issuance of super-long bonds next fiscal year, according to a Reuters report.

“This downward move in interest rates could also be a positive contributor to the Japanese stock market,” said Maki Sawada, equity strategist at Nomura ‍Securities.

“With just three business days to go, attention now turns to whether the Nikkei can close above ‍51,000.”

There were 104 advancers on the Nikkei against 117 decliners. The biggest gainers on the index were brewery Sapporo Holdings, up 2.5%, followed by Disco, a manufacturer of precision cutting tools for semiconductors, which rose 2.4%.

The biggest losers were Sumitomo Electric Industries Ltd, down 4.4%, followed by Mitsui Kinzoku, a major supplier to the artificial intelligence sector, which fell 3%.