Japan’s benchmark index continues to scale recent peaks, rising briefly above the record closing high level reached at the peak of the Japanese asset bubble in 1989.

The Nikkei Stock Average
JP:NIK
was 1.7% higher at 38,924.88 for a temporary moment on Thursday morning, topping the record closing high of 38,915.87 set on Dec. 29, 1989. The index was recently up 1.6% at 38,868.56, compared with the intraday record high of 38,957.44, also reached on the identical day in 1989.

The benchmark index had climbed 14% within the yr to this point through Wednesday, after having risen 28% in 2023, driven by the return of modest inflation, improvements in corporate governance and a weaker yen, which boosts the worth of corporate profits earned overseas in yen terms.

The Tokyo Stock Exchange in March last yr called on listed firms to enhance returns on shareholders’ capital and proper discounts reflected of their share prices, prompting plenty of firms to extend dividends and share buybacks. The move added to the exchange’s efforts lately to usher in more independent directors onto corporate boards in a bid to enhance their oversight of management.

Marred by years of deflation and slow growth, the Japanese stock market has lagged behind others over the past a long time. The Dow Jones Industrial Average has increased greater than 14 times because the end of 1989.

Nevertheless, the Japanese market, together with India’s, has recently attracted increasing amounts of worldwide capital, offering a beautiful alternative to a Chinese market mired in a slump as a result of the country’s property-sector woes and a regulatory crackdown on the tech industry.