Japan Stocks Burst Back After Latest Yen Intervention

Japanese stocks came back with a bang on Thursday, setting all-time records after an extended Golden Week holiday. South Korea and Taiwan also extended their all-time closing highs on Thursday, indicating that chipmakers still have the greatest sway.

Tokyo markets have been out of action all this week until Thursday. The broad-market Topix rose 3.0% on Thursday, while the blue-chip Nikkei 225 surged 5.6%.

Thursday's addition of 3,321 points was the Nikkei’s single biggest day in terms of that measure.

SoftBank Leading Thursday's Charge

We can attribute the gap between the Topix and the Nikkei in part to the better prospects for big caps, particularly exporters that make much of their money abroad.

Japan's government has intervened to protect the yen each time it nears ¥160 to the U.S. dollar.
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Tech stocks are leading the charge, with artificial intelligence plays at the vanguard.

SoftBank Group (SFTBY) (T:9984), which I explained in my last column is prepping an artificial intelligence spinoff on Wall Street, shot up 18.4% on Thursday alone. That doubled its gain for the year so far. Founder Masayoshi Son says he is “all in” on AI.

Amazingly, SoftBank shares are still off of their all-time highs set in October 2025. The volatile stock then corrected 43.7% in less than a month amid concerns that it is overextending itself. It is also one of the biggest investors into OpenAI, which faces stiff competition for its ChatGPT model going up against the likes of Anthropic and Google.

SoftBank’s gains on Thurssday come despite the lunge lower for its chip-design spinoff Arm Holdings (ARM) . Arm shares returned around from a 12% after-hours gain to end sharply lower on Wednesday, with a 5.5% loss after the company said it had not secured supply for a new chip it is making.

SoftBank owns around 90% of Arm after taking it public in 2023. Arm’s shares remain double their price at the start of the year, sitting on a 99.8% gain, even as they shed another 8.1% in early Thursday trade.

Tokyo Chipmakers March Higher

Microcontroller maker Renesas Electronics RNECY (T:6723) roared back to action with a 13.0% run up on Thursday, fellow chipmaker Tokyo Electron TOELY (T:8035) charged ahead 9.0%, while chip-testing equipment maker Advantest ATEYY (T:6857) added 6.8% on Thursday.

Advantest is my pick for an Asian stock this year, and is up 51.3% year to date.

South Korean stocks are also hitting all-time highs. The Kospi closed today up 1.4%, having crossed the 7,000 mark for the first time on Wednesday. It is at 7,490 as of Thursday’s close.

Samsung Crosses $1 Trillion Mark

Samsung Electronics (KR:005930) added 2.1% on Thursday on top of Wednesday’s 15.1% gain that took the company past the $1 trillion barrier for the first time. It is now up 126.4% this year alone.

Taiwan Semiconductor Manufacturing Co. (TSM) (TW:2330) is the only other Asian company larger than $1 trillion in market capitalization. It is up 49.0% so far in 2026.

Taiwan’s Taiex rose 1.9% on Thursday to set a new all-time closing high. Other Taiwan stocks aren’t matching TSMC’s super strong showing, meaning the Taiex is up “only” 42.9% despite the advance in its largest component. TSMC accounts for 40% of the total Taiwan market cap.

We spoke about the narrow gains for the Korean and Taiwan markets on Thursday's Money Talk show, with Peter Lewis. You can find my guest appearance here should you want to have a listen.

Japan's Costly Yen Intervention

A word on the currency. The yen has strengthened from north of ¥160 to the U.S. dollar but is still trading at ¥156, meaning it has lost 51.0% of its value against the U.S. dollar since the start of 2021.

The Japanese government has repeatedly intervened in the currency market to defend the yen. Central-bank data show it has spent some ¥5.0 trillion ($32.1 billion) buying the yen, choosing to act over the last week to make the most of the thin liquidity.

This is the first intervention since July 2024, when the government spent some $36.8 billion to defend the yen after it weakened to ¥162 against the U.S. dollar, a 38-year low.

So we can expect intervention again should the currency rise back toward ¥160. These efforts are expensive and limited in their effect, however, even if the authorities seek to catch traders off-guard.

The yen had been strengthening in January and February this year. With the central Bank of Japan keen to raise extremely low interest rates and the U.S. Federal Reserve trending toward cutting rates, the long-term trends point to a weaker dollar and stronger yen.

Each time the Bank of Japan (BoJ) appears ready to act, however, there’s a geopolitical disruption such as the U.S.-Israel attack on Iran. Japan imports all its oil, 93% of it coming through the Strait of Hormuz. That bottleneck is driving fuel prices sharply higher, hitting a record ¥191 per liter. Thanks to those inflationary pressures and hit to growth, the BoJ is watching and waiting before raising rates.

Tokyo markets were closed last Wednesday, April 29, as well as Monday, Tuesday and Wednesday this week. So many Japanese workers take extra days off to maximize a 12-day break.

At the time of publication, McMillan was long TSM.