Forget about the Sun, Japan is now the land of the rising stock market. This year alone, the Nikkei 225 is up 36.4%. While the actual returns in dollar adjusted terms are quite a bit less (19%), Japan is still one of the top performing equity markets in the world this year.
The strong start to 2013 for equities in Japan is also far and away the greatest YTD performance through 5/7 for the Nikkei since at least 1970. The chart below shows the ten strongest YTD gains through 5/7 for the Nikkei. After this year's gain of 36.41%, the next strongest start to a year was 1987. Back then, the Nikkei was up 26.6% through 5/7 and then proceeded to fall 10.9% over the rest of the year. Based on the returns following the nine prior strongest starts to the year for the Nikkei, the index averaged a gain of 8.0% through year end with positive returns five out of nine times.