Nikkei reaches record high amid pharmaceuticals boost, profit-taking limits gains

(MENAFN) Japan's Nikkei index achieved record levels for the second consecutive session on Monday, buoyed by strong performance in the pharmaceutical sector. However, gains were tempered by profit-taking activities, limiting the index's ascent. Closing at 39,233.71 points, the index marked a 0.35 percent increase, though it retreated from its peak of 39,388.08 points earlier in the session following Friday's holiday hiatus.

This new record peak follows Thursday's milestone, where the index surpassed levels not seen since 1989, during the bubble economy era. The broader Topix index also experienced gains, closing up 0.5 percent at 2,673.62 points. Japanese stocks have been on an upward trajectory, driven by attractive valuations and corporate reforms, which have attracted foreign investment seeking alternatives to the volatile Chinese markets. Year-to-date, the Nikkei index has surged by 16.8 percent.

The index received a boost from record highs in the Standard & Poor's 500 and Dow Jones Industrial Average on Friday. Particularly, the pharmaceutical sector outperformed, with a sub-index climbing by 2.5 percent on Monday. Leading the gains were shares of major pharmaceutical companies such as Shogai, which surged by 6.37 percent, and Daiichi Sankyo, rising by 3.86 percent.

However, gains tapered off in the afternoon session as profit-taking led to selling pressure. Of the 225 stocks on the Nikkei, 121 recorded gains while 102 experienced declines. Technology-related stocks, which had previously reached elevated levels amid optimistic forecasts for the revenue of American chipmaker Nvidia, saw a downturn. Shares of companies like Screen Holdings (-3.49 percent), Lasertech (-2.15 percent), and Tokyo Electron (-1.59 percent) retreated from recent highs, contributing to the moderation in overall market gains.

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