In October 2025, the Nikkei 225 rose for the seventh consecutive month, reaching the 50,000 level for the first time in history. Early in the month, the market started on a soft note due to concerns over a potential U.S. government shutdown, with the index closing in the 44,000 range on the 2nd. Supported by expectations of U.S. rate cuts and a weaker yen, the upward trend strengthened. After Ms. Takaichi’s victory in the LDP presidential election on the 4th, optimism pushed the market higher, and the Nikkei surged to 47,944 on the 6th. In mid-October, the index briefly declined due to the Komeito Party’s exit from the coalition and renewed concerns over U.S. regional banks. However, expectations of a coalition between the LDP and Nippon Ishin, along with gains in generative AI-related stocks, helped the market resume its rise. Following the launch of the new Takaichi Cabinet on the 21st, expectations for expansionary fiscal policy and gains in U.S. high-tech stocks accelerated the rally. On the 27th, the Nikkei closed at 50,512, marking its first-ever finish above 50,000, and ended the month at 52,411. By investor type, foreign investors, trust banks and business corporations were net buyers, while individuals were net sellers (as shown in Figure 1).
