Shares in European and Asian markets showed mostly positive movement on Tuesday, buoyed by political developments in Japan and cautious optimism over easing trade tensions between the United States and China. Japan’s benchmark Nikkei 225 index edged upward, inching closer to the psychologically significant 50,000-point mark following the historic appointment of Sanae Takaichi as Japan’s first female prime minister. Meanwhile, other major indices across Asia and Europe experienced modest gains or slight declines, reflecting a generally positive but cautious investor sentiment amid ongoing global economic and political developments.
In Japan, the Nikkei 225 index gained 0.3%, reaching 49,316.06 points after Takaichi’s successful election in the country’s parliament. As a conservative lawmaker, Takaichi is widely expected to champion market-friendly policies, including maintaining low interest rates and promoting increased government spending. These measures are seen as supportive of economic growth and corporate earnings, which lifted investor confidence in the Japanese market. Concurrently, the U.S. dollar strengthened against the Japanese yen, moving from 150.75 to 151.78 yen. This currency shift is linked to expectations that Takaichi will advocate for a slower pace of interest rate hikes by the Bank of Japan, potentially keeping the yen weaker relative to the dollar. A weak yen could complicate the central bank’s efforts to rein in inflation, which currently exceeds its 2% target, but it also benefits Japan’s exporters by making their products cheaper abroad.
Elsewhere in Asia, markets reflected a similar upbeat tone. Hong Kong’s Hang Seng index rose by 0.7% to close at 26,027.55, while China’s Shanghai Composite index gained 1.4%, finishing at 3,916.33 points. In South Korea, the Kospi index increased by 0.2% to 3,823.84, and Taiwan’s Taiex added 0.2%. Australia’s benchmark S&P/ASX 200 index also climbed 0.7%, ending the day at 9,094.70. These gains were partly fueled by optimism surrounding a potential meeting between U.S. President Donald Trump and Chinese President Xi Jinping at an upcoming regional summit. Investors hope that such high-level dialogue could ease the prolonged trade tensions between the world’s two largest economies, which have weighed heavily on global markets over the past year.
Meanwhile, Chinese Communist Party leaders convened closed-door meetings this week to outline policy priorities for the next five years. While the immediate impact of these discussions on markets remains unclear, investors are keenly awaiting indications of China’s economic direction, especially in light of ongoing trade negotiations and the country’s efforts to balance growth with financial stability.
In contrast to Asia, European markets showed mixed results. Germany’s DAX index edged down by 0.1% to 24,228.07, while France’s CAC 40 in Paris rose slightly by 0.1% to 8,214.58. The United Kingdom’s FTSE 100 enjoyed a modest gain of 0.2%, closing at 9,422.48. Futures for U.S. markets showed a slight decline, with both the S&P 500 and the Dow Jones Industrial Average down by 0.1%, indicating some caution ahead of important earnings reports and economic data releases.
Turning to the United States, stocks had rallied strongly on Monday, pushing major indices close to record highs. The S&P 500 climbed 1.1%, narrowing the gap to just 0.3% below its all-time peak set earlier in the month. The Dow Jones Industrial Average also rose 1.1%, while the tech-heavy Nasdaq composite gained 1.4%. These gains were driven by optimism about corporate earnings and strong demand for new products, particularly in the technology sector.
Apple was a standout performer, surging 3.9% to its own record high amid positive investor sentiment about the demand for its latest iPhone models. The tech giant’s robust performance was a key factor behind the S&P 500’s overall strength. Another notable mover was Cleveland-Cliffs, a steel company that jumped 21.5% after CEO Lourenco Goncalves announced plans to provide further details soon on a potential deal with a major global steel producer. This deal could significantly boost the company’s profits. Additionally, Cleveland-Cliffs revealed potential discoveries of rare earth minerals at sites in Michigan and Minnesota. Rare earths have