The Nikkei 225 continued its run-up on Tuesday, while the yen held losses

Japanese stocks hit another record on Tuesday, building on the previous day’s surge following the election of a pro-stimulus advocate to lead the country’s ruling party, while gold also pushed to a new high.

The election of Sanae Takaichi, who is expected to become Japan’s prime minister this month, came as a surprise but ramped up optimism that she will embark on a campaign on monetary easing.

That sent the Nikkei 225 soaring almost five per cent on Monday and hit the yen as investors began questioning the likelihood that the Bank of Japan will continue its interest rate hikes.

And the index continued its run-up on Tuesday, while the yen held losses.

Takaichi’s victory removes uncertainty about the country’s policy direction, said Saxo Markets’ Charu Chanana. Her agenda is expected to continue a blend of fiscal support and ultra-easy monetary policy.

For investors, that continuity means no abrupt tightening and ongoing coordination between the government and the Bank of Japan, Chanana added.

Yields on 30-year Japanese bonds hit their highest level reflecting fears the country’s already colossal debt will increase further.

Traders continued their rush into tech firms, which have led a global advance this year that has seen several markets hit record highs.

Tokyo-listed Advantest gained more than two per cent and Renesas more than four per cent, while tech investment titan SoftBank rose 2.6 per cent. TSMC in Taipei jumped 2.5 per cent.

That helped push gains across most of Asia, with Singapore, Wellington, Taipei, Manila and Jakarta all up. Hong Kong, Shanghai and Seoul were closed for holidays.

Gold hit a new high of $3,977.44 – pushing closer to the $4,000 mark.