Nikkei 225 Stalls at Historical 53,000 Range — Caution Grows Ahead of BOJ Rate Hike and General Election

"In early February 2026, the Tokyo market saw the Nikkei 225 hovering near historical highs in the 53,000 range, with profit-taking selling leading the way. While the BOJ maintains a 0.75% policy rate, hawkish sentiments suggesting a hike to 1.2% within the year dominated the January minutes, pushing 10-year yields to 2.35%. This is curbing yen weakness but weighing on tech stocks. However, ahead of the February 8 election, expectations for Prime Minister Takaichi's large-scale stimulus are supporting domestic and bank stocks, as the market oscillates between 'monetary normalization' and 'aggressive fiscal policy'."