World Shares Rally and Japan’s Nikkei Jumps After Takaichi Election Victory

Global stock markets advanced on Monday as investor confidence improved following a decisive parliamentary election victory for Japanese Prime Minister Sanae Takaichi’s ruling Liberal Democratic Party (LDP). The decisive outcome, which saw the LDP secure a two-thirds supermajority in the House of Representatives, was widely welcomed by markets for its potential to reduce political uncertainty and support policy stability.

In Tokyo, the Nikkei 225 share index jumped as much as 5% on the day, hitting new intraday record levels before settling up nearly 4% and closing above 56,000 points. The broader Topix index also rose strongly, while key gains were seen in sectors sensitive to fiscal and economic policy optimism.

Other Asian markets also rallied in early trading, with South Korea’s Kospi gaining over 4% and Hong Kong’s Hang Seng climbing nearly 2%. Investors in the region were buoyed not only by Japanese market strength but also by positive momentum from recent U.S. stock gains and a rebound in technology shares.

European markets followed the upbeat trend, with Germany’s DAX and France’s CAC 40 posting modest gains, while British shares edged higher. U.S. stock futures also rose as the week began, supported by a strong rebound in major U.S. indices at the end of the previous trading week.

Analysts attributed the global market rally in part to the removal of political ambiguity in Japan, seen as beneficial for economic policy direction. The LDP’s supermajority gives Takaichi a strong mandate to pursue her agenda, which may include fiscal stimulus and policy measures aimed at boosting growth, although concerns remain about long-term debt dynamics and policy execution.