Japan Market Daily | Kabutaro & Friends

On May 7, 2026, the Nikkei 225 surged by 3,320 yen to close at a record high of 62,833 yen, driven by easing geopolitical tensions and a rally in U.S. markets. Reports of an impending ceasefire between the U.S. and Iran triggered a sharp decline in crude oil prices, alleviating fears of cost-push inflation and fueling a "risk-on" sentiment. Buying was particularly heavy in AI and semiconductor stocks, with Kioxia Holdings hitting a post-listing high. In the FX market, the yen strengthened significantly, briefly touching the 155 range against the dollar amid speculation of government intervention. Meanwhile, BOJ minutes from the March meeting revealed that members highlighted upside inflation risks and discussed the necessity of timely rate hikes. Despite the market rally, the IMF warned of a potential downward revision to global growth due to ongoing supply chain fragilities, keeping resource security at the forefront of policy agendas.