Nikkei

The Nikkei is a stock market index for the Tokyo Stock Exchange, tracking the performance of 225 leading Japanese companies. Formally known as the Nikkei 225 Stock Average, it is Japan's most widely quoted equity index and serves as a key barometer of the country's economic health. The index is price-weighted, meaning that stocks with higher share prices have a greater influence on its movements, similar to the methodology used by the Dow Jones Industrial Average. Constituent companies span a broad range of sectors including technology, automotive, finance, pharmaceuticals and consumer goods, representing major exporters such as Toyota, Sony and SoftBank. The Nikkei is calculated and published by Nikkei Inc., the parent company of the Nikkei financial newspaper. Movements in the index are closely watched by global investors as an indicator of sentiment towards Asian equities and the health of Japan's export-driven economy. The index is denominated in yen, so currency fluctuations can significantly affect returns for international investors. It reached an all-time high in December 1989 during Japan's asset price bubble, and subsequent decades of stagnation made it a symbol of the country's prolonged economic malaise. The Nikkei was first calculated on 7 September 1950, initially under the name Nikkei Dow Jones Stock Average, reflecting its methodological roots.