FX.co ★ Japanese Shares Rally on Trade Optimism

On Friday, the Nikkei 225 surged by 1.56% to close at 37,503, while the broader Topix Index increased by 1.29% to 2,733; both indices reached their highest levels in six weeks due to renewed global trade optimism. This upward trend was fueled by the announcement of a preliminary trade agreement between the US and the UK by President Donald Trump, marking the first such deal since the imposition of extensive US tariffs the previous month. Additionally, Trump suggested the potential for more trade agreements and hinted at possible tariff reductions on China, contingent upon the outcome of high-level discussions scheduled in Switzerland over the weekend. Domestically, investor sentiment was buoyed by reports of unexpectedly strong personal spending in March, indicating robust consumer demand. However, the persistent decline in real wages, which dropped for the third consecutive month, dampened enthusiasm slightly and raised concerns about the overall economic outlook. Leading gainers included Fast Retailing, which rose 2.7%, IHI Corp with a 2% increase, and Toyota, which climbed 1.8%. Over the week, the Nikkei increased by 1.8%, while the Topix gained 1.7%.