The Bank of Japan believes that there are signs of overheating in the Japanese stock market

The Bank of Japan stated on Thursday that there are early signs of overheating in the Japanese stock market and warned that uncertainty surrounding U.S. trade policies could trigger severe market corrections, impacting financial institutions. In the Bank of Japan's semi-annual financial system report, there is a heat map that visually presents the financial imbalances of various asset prices and credit conditions, where "red" indicates overheating. The heat map shows that stock price items are "red," while the other 13 categories are all "green," indicating no significant deviation from trends. On Tuesday, after high-profile politician Sanae Takaichi, who supports fiscal stimulus policies, became Japan's first female prime minister, both the Nikkei 225 index and the TOPIX index reached historic highs