Japan’s Nikkei 225 index surged to its highest level in a year, driven by optimism surrounding a recent trade agreement that investors believe will bolster Japan’s export-driven economy. The announcement of the trade deal has heightened market sentiment, pushing the index up by over 2%, reflecting strong investor confidence in the country’s economic prospects.

In contrast, Japan’s government bond prices experienced a decline as yields rose, indicating a shift in investor preference away from safe-haven assets towards equities. The bond market slide comes amid expectations of sustained economic revival and potential monetary policy adjustments.

Market participants remain attentive to global cues, including developments in trade dynamics and sectoral performances which showed mixed results during the trading session. While electronic and export-oriented sectors led gains, some other sectors exhibited volatility.

Overall, the Nikkei’s rise underscores growing confidence in Japan’s economic recovery, spurred by international trade cooperation, even as careful monitoring of bond market movements continues.

Investors are advised to watch for further updates on trade policies and economic indicators that could impact market trends in the near term.