Editor’s Note
Today’s market rebound highlights shifting investor sentiment as geopolitical concerns ease. Key developments include a sharp Nikkei recovery, corporate earnings driving volatility, and emerging political themes influencing specific sectors.
- Nikkei Average rebounds sharply for the first time in 6 days! Concerns over US-Europe tensions ease.
- Disco’s earnings report leads to upper-limit surge; SMS sees emergence of ‘activist shareholder’.
- Spotlight suddenly on ‘election’-related stocks like Musashi due to Lower House dissolution.
The Nikkei Stock Average rebounded sharply for the first time in six days! In the US market on the 21st, major stock indices all rose for the first time in three days. President Trump announced the suspension of additional tariffs targeting eight European countries, easing concerns about worsening US-Europe relations. A wide range of stocks were bought, with semiconductor stocks like Arm Holdings and SanDisk particularly notable for their gains. In today’s Tokyo market, high-tech stocks such as SoftBank Group and Advantest led the Nikkei average, which at one point in the mid-afternoon session rose to 53,922.53 yen (+1,147.89 yen). The forex market moved towards yen weakness, with the USD/JPY rate in the high 158-yen range.
Tonight in the US market, the release of Personal Income and Personal Consumption Expenditures (PCE) for October and November 2025 is scheduled. The PCE Price Index is closely watched as an inflation indicator and for gauging the future of monetary policy. Tomorrow around noon, the results of the Bank of Japan’s monetary policy meeting are expected to be announced. While policy rates are expected to remain unchanged at this meeting, the future pace of rate hikes is likely to be explored. Additionally, the ordinary Diet session is set to be convened, with the dissolution of the Lower House expected to be declared at the beginning of the plenary session.
【Nikkei Average】53,688.89 yen ↑↑ (+914.25 yen)
【Growth 250】715.87 ↓ (-4.93)
【NYSE Dow】49,077.23 dollars ↑↑ (+588.64 dollars, 21st)
【NASDAQ】23,224.825 ↑↑ (+270.503, 21st)
68,570 yen (+10,000 yen)
Semiconductor manufacturing equipment. The stock hit the upper limit, approaching its all-time high of 68,850 yen (intraday, adjusted for stock split) set in July 2024. The company announced its Q3 FY2026 (April-December 2025) results, with operating profit increasing 9.7% year-on-year to 126.2 billion yen. It provided a full-year operating profit forecast of 172.1 billion yen, up 3.2% from the previous year. Shipment values remain high, and demand appears robust, particularly for AI (artificial intelligence)-related products.
1,616 yen (+235 yen)
Medical and nursing care staffing. The stock rebounded sharply for the first time in three days, reaching its highest level since early October last year. A large shareholding report submitted on the 21st revealed that Oasis Management, a Hong Kong investment fund known as an ‘activist shareholder,’ holds 7.76% of SMS shares. The purpose of holding is stated as ‘important proposal actions,’ and buying interest seems to have emerged on speculation of some forthcoming demands.
4,535 yen (+115 yen)
Operates the VTuber group “Nijisanji.” The company announced it will conduct a share buyback of up to 1.25 million shares, equivalent to 2.05% of issued shares (excluding treasury shares), with a maximum amount of 5 billion yen. The acquisition period is until April 30th. The company announced its H1 FY2026 (May-October 2025) results in December last year, but they were perceived as disappointing due to factors like revenue timing shifts, leading to a sharp stock price decline.
Prime Minister Sanae Takaichi announced on the 19th that she will dissolve the House of Representatives at the beginning of the ordinary Diet session to be convened on the 23rd. The Lower House election will be officially announced on the 27th, with voting and counting on February 8th, making the period from dissolution to voting day a mere 16 days—the shortest in post-war history. She set the victory line as “a majority for the Liberal Democratic Party and Nippon Ishin no Kai” and explicitly stated she would “stake her position” on the outcome. With investor interest likely to focus on this short-term battle, attention is drawn to ‘election’-related stocks.
Many had originally anticipated dissolution after the FY2026 budget enactment around late March or later, or around June when the ordinary Diet session ends. Precisely because of this, election-related stocks suddenly came into the spotlight due to the abruptly emerging dissolution speculation. Furthermore, Yoshifumi Yoshimura, leader of Nippon Ishin no Kai (Governor of Osaka Prefecture), proposed a “double election” for the Osaka Prefectural Governor and Mayor to coincide with the Lower House election. This is also expected to further heighten interest in election-related stocks.
Among election-related stocks, Musashi, which handles election system equipment including vote reading/sorting machines, counting machines, and issuance machines, holds a representative position. Its stock surged sharply on the 13th triggered by dissolution speculation reports but has since largely given back those gains. As the election campaign intensifies with tomorrow’s Lower House dissolution and the official announcement on the 27th, it will be noteworthy whether investor interest gathers once again.
The table above lists notable ‘election’-related stocks besides the aforementioned Musashi. Oji Holdings is involved through its joint venture with Mitsubishi Chemical (under Mitsubishi Chemical Group), Yupo Corporation, which handles synthetic paper “YUPO” made by the film method. It excels in durability, water resistance, printability, and opacity, and is used in numerous elections for posters and ballot papers.
Nippon Light Metal Holdings is involved through its group company Nikkei New Business, which handles aluminum display boards for election posters. Additionally, Toppan Holdings’ group company Toppan Edge can provide one-stop services from admission ticket creation and printing to envelope stuffing and sealing. Furthermore, if election trends suggest a ruling party victory, popularity may reignite for stocks related to defense, space, and AI (artificial intelligence)—areas highlighted in the Takaichi administration’s growth strategy.