TOKYO — Japan’s Nikkei record high set the tone for a global risk-on session Monday after Prime Minister Sanae Takaichi’s landslide election win boosted expectations for easier fiscal policy, while investors took comfort from a rebound in U.S. chip stocks, Feb. 9, 2026.
The Nikkei record high also arrived as traders leaned more heavily toward U.S. rate cuts later this year, even as a fresh warning signal out of China about U.S. Treasuries briefly pushed yields higher and reminded markets that geopolitics still sits under the tape.
Nikkei record high rides politics and policy momentum
The Nikkei 225 surged past 56,000 in early trading and kept climbing as investors interpreted Sunday’s result as a mandate for policy continuity and additional spending and tax measures. Reuters reported the index crossed 56,000 for the first time, with the broader Topix also advancing.
Japan’s currency firmed and bond markets reacted, too: shorter-dated Japanese government bond yields edged up as traders weighed how much new fiscal support could mean for borrowing. The market’s message was straightforward: the election removed uncertainty, but investors still want to see how any stimulus is paid for.
Chip rebound meets Fed cut expectations
Outside Japan, the day’s tailwind was equal parts tech and macro. A Reuters global markets report said bargain-hunting in beaten-down assets — including technology shares — helped stabilize sentiment after a volatile week, while investors focused on a heavy U.S. data calendar for clues on the next move from the Federal Reserve.
Rate-cut expectations have become a key feedback loop for equities: lower anticipated borrowing costs can support higher valuations, especially in growth sectors that are sensitive to long-term yields. Traders often monitor those expectations through the CME FedWatch tool, and the next round of U.S. jobs, inflation and consumer spending reports will likely determine whether “cuts by midyear” remains the base case.
China’s Treasuries message lands, but doesn’t derail the rally
Still, a parallel narrative ran through bond desks: Bloomberg reported that Chinese regulators have advised financial institutions to rein in U.S. Treasury holdings, citing concentration risks and market volatility, while indicating the guidance does not apply to China’s state holdings.
The market reaction was muted in part because this is not a new story line. A Reuters analysis in early 2024 detailed how China’s direct footprint in U.S. Treasuries had already shrunk dramatically from its early-2010s peak, reducing the notion that Beijing can easily “move” the Treasury market with a single decision.
A rally with history — and a near-term test
Japan’s latest Nikkei record high also extends a longer run that has been shaped by corporate reforms and renewed investor attention. The shift became unmistakable when the index finally surpassed its bubble-era 1989 peak in 2024, as an Associated Press report noted at the time.
For now, investors are treating the Nikkei record high as a sign that Japan can keep attracting capital in a world still searching for growth and policy clarity. The next checkpoint is straightforward: if U.S. data keeps the Fed-cut narrative alive, the Nikkei record high could look less like a one-day headline and more like part of a broader repricing of risk.
