Tokyo’s Nikkei ends up over 2% after PM says will step down

TOKYO (AFP) – Tokyo’s benchmark Nikkei index closed up slightly more than 2 percent on Friday after Japan’s prime minister said he will not run for his ruling party’s leadership, effectively ending his tenure.

The Nikkei 225 jumped 2.05 percent, or 584.60 points, to end at 29,128.11, while the broader Topix index gained 1.61 percent, or 31.88 points, to 2,015.45.

Prime Minister Yoshihide Suga told reporters that he had realised running for the leadership election of his Liberal Democratic Party and handling the virus response would require “enormous energy”.

“I came to the realisation that I cannot do both. I had to choose one of them,” he added.

The shock decision after just a year in office comes with Suga’s approval ratings at an all-time low over his government’s handling of the response to the pandemic.

The market reacted positively to the news.

“Buying sentiment grew as traders expected that support rate for the LDP would go up if a new leader emerges,” Yoshihiro Ito, senior strategist at Okasan Online Securities, said in a commentary.