Investors may have breathed a sigh of relief as the Nikkei stock index recovered briefly to the 10,000 line Thursday for the first time since the global financial crisis sparked a plunge last October, reflecting strong optimism that the worst of the recession is over.
But market analysts caution that while the downside for Japanese stocks may have proved to have become more resilient amid a diminished likelihood for another financial crisis, the road to a full-scale rebound remains rugged as investors seek more reassurance on the strength of the real economy.
Prime Minister Taro Aso hailed the Nikkei's rise as a good sign for the nation's economy, saying: "It is encouraging news. There have been some improvements in industrial production and leading economic indicators, so we have seen good momentum building up."