The Nikkei 225 Index did well this year, rising from a low of ¥31,145 in April to a record high of ¥52,590. It rose by nearly 30% this year, outperforming most global indices like the S&P 500, FTSE 100, and the German DAX. 

Why the Nikkei 225 Index soared

The Nikkei 225 Index surged this year, even as the Bank of Japan maintained its hawkish tone and Japan bond yields soared to the highest level in decades. Data shows that the ten-year bond yield jumped to a multi-year high of 2.10%, while the five-year soared to 1.54%.

The index jumped because of the ongoing artificial intelligence boom, which benefited some of the biggest players in the industry, like Advantest and Softbank.

Additionally, it jumped because of the falling Japanese yen, which continued its freefall during the year. The USD/JPY exchange rate rose from a low of 139.87 in April to a high of 157.83.

A weaker Japanese yen benefits the Nikkei 225 Index by helping its biggest exporters, including automakers like Toyota, Mazda, and Honda. Other large industrial companies like Hitachi and Mitsubishi Electric also benefited.

Meanwhile, like other indices, the Nikkei Index jumped after Donald Trump signed a trade agreement with Japan, which reduced tariffs for goods from the country. This deal brought the levies to 15%, down from over 30%, with Japan promising to invest billions of dollars in the United States.

Nikkei 225 Index | Source: TradingView

Top gainers and laggards in 2025

Most companies in the Nikkei 225 Index did well this year. Sumitomo Dainippon, a giant player in the pharmaceutical industry, soared by 311% this year, bringing its market capitalization to over $4.35 billion. This surge happened as the company made progress on its pipeline and as the turnaround gained steam.

Mitsui Mining & Smelting stock price jumped by 286% this year, with its valuation hitting over $7 billion. This surge happened as commodity prices continued soaring, with gold, silver, and copper gaining momentum. The jump benefited this company as it provides engineered materials used in the mining industry.

Fujikura share price soared by 173%, with its valuation jumping to $36 billion as demand for its technology products rose. Advantest, a top player in the semiconductor industry, rose by 116%, while Sumitomo Electric rose by 123%.

Japanese bank stocks also did well as the Bank of Japan (BoJ) hiked interest rates during the year. Shizuoka Bank stock rose by 90%, while Concordia Financial, Mizuho, Chiba Bank, and Sumitomo Mitsui Financial jumped by double digits during the year.

Meanwhile, Softbank’s stock price jumped by 90% this year. Recently, however, the stock has dropped by over 35% this year as concerns about the AI bubble have remained.

On the other hand, the top laggards in the Nikkei 225 Index in 2025 were companies like Itochu, KDDI, Bridgestone, Daiichi Sankyo, and Recruit Holdings, which dropped by over 20%.

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