Japan’s Nikkei index exceeded 69,700 points for the first time. It hit an intraday high of 69,705 on Monday, rising more than 5% as an agreement between the United States and Iran to end their war ignited a broader stock market rally.
The index added nearly $465 billion, or 77.22 trillion yen, to market capitalization. At the time of writing, the Nikkei index stood at 69,234 points.
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The agreement between the United States and Iran leads to a broader rise in the stock market
President Donald Trump Announcing a deal to end The conflict sent stocks soaring. The agreement ends the US naval blockade of Iran And reopens The Strait of Hormuz, a major route for oil.
The agreement will be signed in Switzerland on Friday. Crude oil prices fell on this news, with WTI falling approximately 4.6% and Brent falling approximately 5%.
Stocks and cryptocurrencies have moved In the opposite direction. US stock futures He pointed out Dow Jones Industrial Average futures rose 342 points, or 0.7%. Contracts tied to the S&P 500 rose 0.9%, and Nasdaq 100 futures led the way, up 1.4%.
Asian indices recorded the biggest moves today. South Korea KOSPI topped the region An increase of 5.46%. Japan’s Topix index rose 3.3%.
Digital assets have also joined the advance. The overall cryptocurrency market capitalization rose nearly 2%, and Bitcoin (BTC) surged towards 66,000.
An interest rate decision that can reverse a rise
However, feelings can change quickly. Bank of Japan (BOJ) It is widely expected to rise Interest rates to 1% from 0.75% on Tuesday.
Higher Japanese interest rates reduce the attractiveness of yen-financed carry trades by increasing borrowing costs and narrowing the yield advantage available in offshore markets. In this strategy, investors borrow yen at low interest rates and invest the proceeds in higher-yielding assets abroad, including stocks, bonds, and cryptocurrencies.
Also carry trades become less profitableHowever, investors may reduce leverage and move capital back to Japan, which could impact global equity markets and other risky assets.
Since markets have largely priced in the interest rate hike, investors may focus more on the Bank of Japan’s guidance than on the rate hike itself. Reuters reconnaissance It showed that economists expect the Bank of Japan to follow with another rate hike to 1.25% in the fourth quarter.
Any sign that policymakers intend to tighten policy more aggressively than expected could pressure stocks, cryptocurrencies and other risk-sensitive assets by accelerating the unwinding of yen-funded positions.
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