Nikkei index rises 5% to 69,322.76

The Nikkei 225 Index surged nearly 5% to 69,322.76 on Monday, reaching record highs as renewed hopes for a Middle East peace agreement boosted investor sentiment. The breakthrough deal, aimed at ending the conflict between the U.S. and Iran and reopening the Strait of Hormuz, led to a sharp decline in oil prices to a two-month low, easing inflationary pressures for energy-dependent economies like Japan. The market was also influenced by expectations that the Bank of Japan will raise interest rates this week to manage inflation and support the yen.

Technology and AI-related stocks were among the top performers, with Kioxia up 7.5%, Murata Manufacturing gaining 14.3%, and SoftBank Group rising 9.4%. The broader Topix Index also climbed, reflecting a positive shift in market sentiment. The recent gains follow a strong performance over the past month, with the index rising 14.05% and up 81.04% compared to the same period last year. Analysts anticipate continued volatility, with forecasts suggesting the index may trade at 65,507.51 points by the end of the quarter.