Japanese stocks just boomed 7.7% in the biggest rally since 2008

Business Insider | Myles Udland and Mike Bird

Stocks in Japan just went bananas.

On Wednesday (Tuesday night in New York), Japan’s benchmark Nikkei Index opened up higher and rallied throughout the day, closing 7.7% higher, or more than 1,000 points, in a continuation of Tuesday’s global stock rally.

That’s the biggest day for the Nikkei since late 2008.

Prime Minister Shinzo Abe on Tuesday won another three years as leader of his political party, and he committed to cutting corporate taxes by at least 3.3 percentage points next year.

On Tuesday, US stocks reopened after a long weekend and surged more than 2% across the board, with the Dow gaining more than 390 points.

And so after the US took its lead from Europe earlier on Tuesday, markets in Asia have followed into Wednesday.

The Financial Times pointed out that the rally in Japan was a little mysterious. Abe’s tax cuts have been on the table for quite a while. China’s Ministry of Finance on Tuesday night said it would enact “stronger proactive fiscal policy” to battle its slowing economy, but it seems as if that should show up more in the Shanghai Composite, which is up by less than 2%.

Here’s how it looks:

The Japanese yen, meanwhile, was a bit weaker against the dollar as the dollar extended its rally that was sparked overnight on Tuesday.

Source: Business Insider