The moment finally arrived. On the morning of April 23, 2026, the Nikkei 225 broke through 60,000 yen intraday for the first time in history, 36 years and 4 months after Japan's bubble peak of 38,915 yen on December 29, 1989. Behind the symbolic milestone, however, market professionals are already cooling the champagne. "This is a fundamentally different market from 1989," they say. Buying is concentrated in a handful of AI names. One in three Japanese shares is now held by a foreigner. And in dollar terms, the picture looks rather different. Here are five numbers that explain where Japan's stock market actually stands today.

What happened on April 23

The Tokyo market opened higher on Thursday. The opening price was 59,758.64 yen, already 172.78 points above Wednesday's close of 59,585.86, which itself was a record. From the bell, the index pushed straight up and tagged 60,000 in the 9 a.m. hour.

The drivers were the usual suspects: SoftBank Group jumped as much as 9.6%, Renesas Electronics rose 8.7%, and Kioxia Holdings was up 5.4%. Strong earnings from semiconductor and AI-related companies, both in Japan and abroad, confirmed that global AI demand remains hot.

The party didn't last all day, though. Profit-taking kicked in late morning, and during the afternoon session the Nikkei briefly dropped almost 900 points. Touching 60,000 is one thing. Closing above it is another story entirely.

Number 1: 1989's peak was 38,915 yen: at a PER of about 60×

Foreign readers may not realize this, but Japan's stock market literally spent 36 years failing to break above its 1989 peak. On December 29, 1989, the Nikkei closed at 38,915.87 yen, and that record stood until 2024, when it was finally surpassed.

Yet "one yen of Nikkei" in 1989 meant something very different from today. The price-to-earnings ratio of the bubble market was around 60 times, investors were paying for 60 years of corporate profits in a single share. Today's PER sits around 16×, roughly a quarter of that level. Japan's market is no longer being valued like a fairy tale.

There's another structural difference. The 1989 rally was led by banks and real estate, a textbook asset bubble fueled by post-Plaza Accord low rates and the "land myth." The April 2026 rally is led by AI and semiconductors, riding global capex from hyperscalers, generative-AI demand, and data-center expansion. There is real corporate earnings underneath the price action, even if it's concentrated in a few names.

Calling this "1989 all over again" looks premature.

Number 2: In dollar terms, it's about $380: and the yen is doing a lot of the work

Japanese investors may toast 60,000, but in dollar terms the picture shifts.

At about 158 yen per dollar, 60,000 yen equals roughly $380. The 1989 bubble peak (38,915 yen at the then-rate of ~143 yen/dollar) was about $272. So yes, dollar-denominated Japan has also broken the 1989 record, but more modestly. While the Nikkei in yen is up about 54% from the old high, the yen has weakened sharply over the same period (from the 130s to the 158s per dollar), so the dollar gain is meaningfully smaller than the yen gain.

The S&P 500 closed at 7,064 on April 21, also near record highs. US tech is rallying on the same AI story. Lined up against the S&P in dollars, much of the Nikkei's spectacular surge looks like a yen-weakness rally as much as a Japan-strength rally. For overseas investors, the cheap yen has been a powerful tailwind making Japanese equities look discounted.

Number 3: Foreign ownership has gone from 5% to 32.4%

The single biggest structural change since 1989 is who actually owns Japanese stocks.

According to the Japan Exchange Group, foreign investors held only about 5% of Japanese shares at the start of the 1990s. The market was dominated by domestic players: cross-shareholdings between business partners, banks, life insurers. By the end of fiscal 2024, foreign ownership had climbed to 32.4%, the highest level since data collection began. Foreigners also account for roughly 68.4% of gross trading turnover over the past five years.

In other words, today's Tokyo market is one where foreigners decide direction. Push higher and the market rises; pull money out and it drops. The breach of 60,000 reflects overseas money rotating into Japan on the back of US tech strength, yen weakness, and the AI theme. If 1989's bubble burst was an "implosion from inside," any future correction may well come as an outflow from outside, and that's a very different risk profile.

Number 4: A handful of stocks account for ~80% of the gains

"The Nikkei keeps hitting records but my portfolio isn't going anywhere." This complaint has become widespread among Japanese retail investors, and the reason is mathematical: the rally is dramatically narrow.

In one recent session, of the Nikkei's 524-point gain, SoftBank Group and Tokyo Electron alone contributed about 481 points, roughly 92%. The Nikkei 225 is a price-weighted index of 225 stocks, but a handful of high-priced AI/semiconductor names dominate the math.

Japanese TV personality JOY (Junichi Hashimoto) posted on X on April 23: "Nikkei breaks 60,000 for the first time! But my portfolio is not in a celebratory mood at all." The post resonated. The gap between "the index" and "my account" is structural, not bad luck.

Number 5: Middle East tensions could shorten the rally's shelf life

There's an invisible tug-of-war underneath this rally: the US-Iran situation.

Washington and Tehran have extended their ceasefire, and hopes for a peace deal are supporting risk assets. President Trump's announcement that the ceasefire would last "until negotiations are complete" gave the NY market a short-term relief rally on April 22. But the oil market remains nervous. Any sign of risk to the Strait of Hormuz, and energy prices spike, equities sell off.

The Bank of Japan adds another wrinkle. Nikkei reported that the BOJ would skip a rate hike in April and reassess in June pending Middle East developments, a report that pushed USD/JPY into the 158s. No rate hike → continued yen weakness → Japan stocks stay cheap for foreigners, that loop has been a meaningful part of the 60,000 story.

If the Middle East escalates unexpectedly, or the BOJ moves earlier than markets expect, the loop reverses fast. Among analysts, the bulls call 60,000 "just a stop on the way up"; the cautious side warns of "a speeding ticket coming."

How does this look from your country's market?

Japan really has changed structurally. Corporate governance reform, expanded buybacks, the Tokyo Stock Exchange's pressure on companies trading below book value, foreign capital inflows. This isn't the financial-engineering frenzy of the late '80s; it's a market climbing on actual reform plus the global AI capex wave.

But the days of "Japan is obviously cheap, just buy it" may be ending. The S&P's PER is slightly above its long-run average and the Nikkei's looks similar. Bubble-period high in dollar terms, record-high foreign ownership, record-high concentration in AI names, that's a cocktail that requires its own judgment.

What does your country's stock market look like right now? Are a few tech names pulling the index along Japanese-style, or is the rally broader-based? We'd love to hear how it compares from where you are.

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