Japan’s Nikkei surged to a record high Monday amid speculation Prime Minister Sanae Takaichi will call a snap election. Investors expect expanded fiscal stimulus, lifting export-heavy stocks as the yen weakened to a two-year low.

Chinese markets also climbed, driven by artificial intelligence optimism. The CSI 300 hit a three-year peak after strong AI-sector IPOs and news that Beijing may restrict sales of Nvidia’s newly approved H200 chips, boosting local chipmakers.

Elsewhere in Asia, gains were muted. South Korea’s tech rally stalled, and India’s market lagged amid U.S. trade concerns. Analysts warn Japan’s stimulus hopes could deepen fiscal risks, while China’s AI push faces global supply chain tensions.

Despite upbeat moves in Tokyo and Shanghai, broader regional sentiment was capped by Wall Street’s retreat and investor caution ahead of key U.S. earnings and economic data.