TOKYO – On Friday, the Nikkei Stock Average index rose past 20,000 points for the first time since April 2000. Now that the long-coveted goal has been met, and a lot sooner than many had anticipated, some investors appear to be feeling nervous about what may lie ahead.
After some deep valleys and low peaks, the stock index has finally come back to the level it was at 15 years ago. But further advances from here on are not a given. How much higher the Nikkei will go will depend largely on how far Japan can transform its economy and the way businesses operate.
Foreign investors have been a major driver for the bullish run in the Japanese stock market over the recent months, but they “do not necessarily have complete faith in the future of the Japanese economy,” Akio Yoshino, chief economist at Amundi Japan, warns.
The Nikkei Stock Average stayed above the 20,000 level only for a brief period during Friday morning trading. It gradually declined after hitting the high point, as investors felt the market had achieved a short-term milestone. The index ended the day at 19,907 points, 30 yen lower than the previous day’s close.
It is not hard to see that investors are nervous about where the market will go next — the Nikkei could keep rising for some time, but it is also possible it may have run as high as it can for now.
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