The Nikkei Stock Average notched fresh all-time highs on August 12, 13, and 15, ending the week at 43,378.31 yen—more than 1,000 yen above the previous record of 42,224.02 yen set last July.
There seems to be some confusion regarding the stock market rally during the Obon holiday period.
An NHK news report on August 12 cited market sources suggesting two reasons:
(1) investor optimism based on “TACO” (Trump Always Chickens Out) following the U.S.-China agreement to lower tariffs, and
(2) diversification of investments from the U.S. into Japan and Europe, out of concern that the U.S. would suffer from inflation and an economic slowdown due to tariffs.
It is unclear whom NHK interviewed, but this is hardly the majority view among foreign investors.
