FX168 Financial News Agency (Asia-Pacific) News On Wednesday (November 6th), as Trump led Harris in the USA presidential election and eventually confirmed victory, the Japanese blue chip index rose, while the yen exchange rates fell to the lowest point since July last year.

At the close, the Japanese Nikkei index rose by 2.61% to 39,480.67 points, hitting its highest closing level since October 15. This also marks the largest single-day increase in the Nikkei index since September 26. The broader Topix index rose by 1.94% to 2,715.92 points. #JapaneseMarket#

Among the components of the Nikkei 225, 167 stocks rose, 52 fell, and 6 remained unchanged.

The increase in the Nikkei index was mainly driven by chip and defense stocks, while market participants closely monitored the outcome of the U.S. presidential election.

The acceleration of the Nikkei index's rise was due to the strong performance of the dollar against the yen. The dollar rose by 1.7% against the yen to around 154.25.

Investors believe that with Trump emerging as the winner, the yen may further depreciate as his economic policies are seen as more expansionary and inflationary than Harris's, reducing the likelihood of a significant rate cut by the Federal Reserve.

Given the size and liquidity of the Japanese market, as well as the heightened attention on the dollar-yen exchange rates during the Asian trading session, the Japanese market is particularly under focus.

"If the election results continue to show Trump's victory and the market continues to focus on his growth-promoting policies, the dollar may further rise against the yen," said Carol Kong, strategist at the Commonwealth Bank of Australia. "I just want to warn that if the stock market shifts its focus to the prospect of another trade war between the U.S. and China, the gains in the dollar against the yen could evaporate."

A weakening yen usually boosts the profits of Japanese exporters when repatriating overseas income.

Toyota Motor reversed its early decline to end up 1.72%, despite the company's first quarterly profit decline in two years. Honda Motor dropped by 6.46%, reporting an unexpected 15% decline in second-quarter operating profit.

"Most markets have begun to anticipate the election results, with the U.S. dollar rising and Japanese stock market gaining," said Yugo Tsuboi, Chief Strategist at Daiwa Securities.

Trump won crucial swing states North Carolina and Georgia against Democratic Vice President Kamala Harris, bringing him one step closer to a remarkable political comeback after leaving the White House four years ago.

Japanese technology stocks rose, with chip testing equipment maker Advantest up by 8%, becoming the biggest driver of the Nikkei Index. SoftBank Group, investing in startups, rose by 5.13%.

Across the region, major stock indices saw mixed movements, with the Straits Times Index rising by 0.3%, or 9.57 points, to close at 3,581.61 points.

Defense stocks also rose, with heavy machinery manufacturer IHI's stock price soaring by 19.28% as the company increased its annual net income forecast for the fiscal year ending in March 2025. Mitsubishi Heavy Industries and Kawasaki Heavy Industries rose by 9.85% and 7.34% respectively.

"This is a typical Trump trade," said Takashi Hiroki, Chief Strategist at Monex, as Trump may ask Japan to reduce its reliance on the U.S. for self-defense.