Nikkei Surges Overnight as Japanese Stocks Rally on Geopolitical Relief

The Japanese stock market rallied on Wednesday, recouping losses from the previous two sessions, as the benchmark Nikkei 225 index climbed over 500 points to approach 27,400, buoyed by optimism from Wall Street and easing geopolitical tensions following reports that Russia is withdrawing some troops from the Ukrainian border.

The Nikkei 225 rose 529.36 points, or 1.97%, to 27,394.55, after reaching an intraday high of 27,450.28. The index had closed sharply lower on Tuesday.

Market heavyweights including SoftBank Group and Uniqlo operator Fast Retailing advanced over 2%, while automakers Honda and Toyota gained nearly 3% and 1%, respectively. Technology stocks such as Screen Holdings, Tokyo Electron, and Advantest each rose more than 4%.

In the financial sector, Mizuho Financial edged up 1%, and Mitsubishi UFJ Financial and Sumitomo Mitsui Financial both jumped over 2%. Among exporters, Canon and Sony rose 1% each, while Mitsubishi Electric gained 0.5%. Panasonic slipped 0.2%.

Other notable gainers included Bridgestone, up over 8%, and Kawasaki Kisen Kaisha and TDK, each surging nearly 6%. Asahi Group Holdings climbed more than 5%, while Japan Steel Works, Daiichi Sankyo, and Ebara added 5% each. Yokohama Rubber, ANA Holdings, and Dentsu Group rose over 4%, and GS Yuasa and Mitsui Chemicals gained nearly 4% each.

Inpex fell over 5%. Meanwhile, the U.S. dollar strengthened, trading in the upper 115 yen range.

On Tuesday, Wall Street rebounded strongly from three days of declines, with the Nasdaq leading gains. The tech-heavy index climbed 2.5% to 14,139.76, while the Dow Jones industrial average rose 1.2% to 34,988.84. The S&P 500 surged 1.6% to 4,471.07.

European markets followed suit, with the FTSE 100 gaining 1%, the CAC 40 jumping 1.9%, and the DAX advancing 2.0%. Crude oil prices dropped 3.6% to $92.07 a barrel, as supply concerns eased amid de-escalating Russia-Ukraine tensions.

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