Japan's Nikkei trims 2025 surge as tech stocks take a breather

Japan’s Nikkei share gauge edged lower on the final trading day of 2025 on Tuesday, dragged down by the technology sector that had been a key driver of the year’s massive gains.

The benchmark Nikkei 225 slipped 0.4% to close at 50,339.48, while the broader Topix lost 0.5%. The Nikkei surged 26% in 2025, marking a third consecutive yearly gain and the strongest since 2023. The Topix climbed 22% over the same period.

Japanese equities have been on a strong run, benefiting from a corporate governance push by the Tokyo Stock Exchange and more recently from enthusiasm over artificial intelligence investments.

The Nikkei reached another milestone earlier in the year, touching an intraday record high of 52,636.87 on November 4, after Sanae Takaichi was elected prime minister on a campaign promising massive fiscal stimulus.

“The first half of the year was weighed down by global economic instability, including rising prices, labor shortages, and U.S. tariffs,” Takaichi said at a ceremony at the exchange after the closing bell.

“But in the latter half, the resilience of Japanese companies, together with policy support, propelled the Nikkei to a remarkable turnaround, rising past the 50,000 mark for the first time in history,” she added.

Production: Irene Wang/Reuters