Nomura strategists have increased their year-end targets for Japan's Topix and Nikkei stock indexes, citing stronger-than-expected corporate earnings and sustained growth in artificial intelligence (AI) related sectors. The firm raised its Topix target for the end of 2026 to 4,200 points from 4,000, and its Nikkei target to 68,000 points from 60,000. Looking ahead, Nomura forecasts the Topix to reach 4,400 points by the end of 2027 and 4,600 points by the end of 2028, while the Nikkei is projected to hit 70,000 points by the end of 2027 and 72,500 points by the end of 2028. The strategists noted that AI and semiconductor-related companies are expected to see profit growth this fiscal year, with earnings forecasts being revised upward rapidly. Additionally, market expectations for a potential peace agreement between the U.S. and Iran, which could lead to lower oil prices, are viewed as a positive factor for Japanese equities.