Sharp Market Fluctuations

「In the domestic equity market, the Nikkei 225 plunged in April following the shock from US reciprocal tariffs. It subsequently reached an all-time closing high of ¥45,754 on 25 September, supported by a tariff agreement with the United States, expectations of an end to deflation and increased global investment in generative AI.」

「The Nikkei 225's return for the period from April 2024 to March 2025 was -11.8%, with the market weighed down mainly by heightened uncertainty regarding the US economy and concerns over US automotive tariffs.」

「In the domestic equity market, the Nikkei 225 reached an all-time high of ¥42,426.77 on 11 July, supported by gains in US equities and the weaker yen. It subsequently fell temporarily to the ¥31,000 range, triggered by an interest-rate hike by the Bank of Japan and deterioration in US employment conditions, but share prices have recently been recovering, supported by the continued weakness of the yen and an improvement in US conditions.」

「In the domestic equity market, the Nikkei 225 showed significant volatility during the third quarter (October-December 2023), falling below ¥31,000 at times in October before reaching the ¥33,800 range in November and December. The foreign exchange market was similarly volatile, with the yen strengthening against the US dollar from a high of ¥151.91 on 13 November to a low of ¥140.25 on 28 December.」

「Although the global equity markets have gradually absorbed some of the uncertainties, including the prolonged impact of COVID-19 and the Russia-Ukraine conflict, ongoing inflation and interest-rate hikes, many investors remain concerned about the outlook, resulting in volatile price movements. Against this backdrop, Japanese equities have notably tended to outperform global markets, supported by the weaker yen and other factors. The domestic equity market lacked the strength to push further higher amid caution over elevated valuations following its sharp rise since early spring. The Nikkei 225 declined 4.01% during the quarter, while the TOPIX rose 1.52%, supported by renewed buying of value stocks and other factors. Asian equity markets showed mixed performance by country. The slowdown in China and downward pressure on currencies associated with US interest-rate hikes weighed on markets, while Vietnam's monetary easing provided support.」

「The domestic equity market continued to rise sharply as overseas investors continued buying, driven by continued monetary easing, expectations for corporate governance reform at Japanese companies, the ongoing yen depreciation and reports of additional investment in Japanese equities by a prominent US investor. The Nikkei Stock Average rose more than 18% over the three-month period, while the TOPIX rose 14%, both renewing post-bubble highs. Asian equity markets remained weak against a backdrop of Asian currency depreciation accompanying continued interest-rate hikes by the US Federal Reserve and European central banks, as well as declining exports from various countries.」

「Inflation and soaring fuel costs, among other factors, weighed on the national economy, and the Nikkei Stock Average reached the fiscal-year low of ¥25,520.23 on 20 June.」

「Accelerating inflation, concerns about interest-rate hikes and currency uncertainty are weighing on the global economy and equity markets for the time being. Amid the trend toward monetary tightening in the United States, foreign exchange volatility also increased, and the Japanese yen fell to its lowest level against the US dollar since 1998. The Nasdaq Index declined 25.6% over the period, while other major indices, the S&P 500 and the Dow, also fell sharply, declining 20.9% and 17.2%, respectively, over the period.」

「Accelerating inflation, concerns about interest-rate hikes and currency uncertainty are weighing on the global economy and equity markets for the time being. Amid the trend toward monetary tightening in the United States, foreign exchange volatility also increased, and the Japanese yen fell to its lowest level against the US dollar since 1998. The Nasdaq Index declined 25.6% over the period, while other major indices, the S&P 500 and the Dow, also fell sharply, declining 20.9% and 17.2%, respectively, over the period.」

「The US equity market started on a weak note, weighed down by rising interest rates against a backdrop of global inflation concerns and the prolonged turmoil surrounding Ukraine. It subsequently showed resilience on expectations for US monetary policy, supported by firm economic indicators and strong corporate earnings, but the S&P 500 Index fell from 4,530.41 points on 31 March to 3,785.38 points on 30 June.」

「After the start of 2022, rising resource prices, including crude oil, and Russia's invasion of Ukraine drove the Nikkei Stock Average to a year-to-date low of ¥24,681.74 on 9 March. However, solid corporate earnings and the weaker yen against the US dollar were viewed positively, and the Nikkei Stock Average ended March at ¥27,821.43.」

「Although the Nikkei Stock Average declined 1.3% over the period, it reached ¥30,670 in September, at one point marking its highest level in approximately 31 years since August 1990.」

「From around April through August, the Japanese equity market remained weak against a backdrop of social and political uncertainty related to the spread of COVID-19. The Nikkei Stock Average recorded an intraday year-to-date low of ¥26,954.81 on 20 August. However, the equity market rebounded after former Prime Minister Suga announced on 3 September that he would not run in the LDP presidential election, reaching ¥30,795.78 on 14 September, its highest level in 30 years since 1990.」

「The US equity market remained firm. The S&P 500 Index rose approximately 8%, from 3,972.89 points on 31 March to 4,297.50 points on 30 June. As progress in vaccinations made the recovery from the economic damage caused by COVID-19 increasingly apparent, it supported investor confidence. On the other hand, a sharp rise in the April consumer price index spread caution, while the fact that a majority of Federal Open Market Committee members forecast interest-rate hikes in 2023 at the June FOMC meeting and Federal Reserve Chair Powell's statement that discussions on tapering, or reducing quantitative easing, would begin created factors of instability for share prices. Nevertheless, views that inflation would be temporary and stability in long-term interest rates supported higher share prices.」

「The domestic equity market strengthened its risk-on movement, riding the trend of monetary easing in major countries and rising share prices despite stalled economic activity following the spread of COVID-19 and the declaration of a state of emergency. The Nikkei Stock Average rose 17.82% over the period, a double-digit gain, and closed at ¥22,288.14 at the end of June.」

「The domestic equity market, as measured by the Nikkei Stock Average, moved in a range centered around ¥21,000 during the first half of the fiscal year. It turned higher from September, triggered by monetary easing in the United States, and recovered to the ¥24,000 level. However, as market sentiment deteriorated due to the spread of COVID-19, it fell to the ¥16,000 level in March.」

「The domestic equity market rose from the Nikkei Stock Average closing price of ¥21,509.03 on 1 April to ¥22,307.58 on 25 April, but subsequently came under increasing downward pressure as US-China tensions intensified and fell to ¥20,261.04 on 26 August. In September, it turned higher against a backdrop of global monetary easing and gains in US equities, recovering to ¥24,066.12 on 17 December.」

「The domestic equity market rose from the Nikkei Stock Average closing price of ¥21,509.03 on 1 April to ¥22,307.58 on 25 April, but fell in May after US-China negotiations ended unsuccessfully. It subsequently recovered on expectations of US interest-rate cuts and other factors, but fell again in August as US-China tensions intensified, reaching ¥20,261.04 on 26 August. In September, it recovered to ¥22,098.84 on 24 September as US equities rose against a backdrop of global interest-rate declines and other factors.」

「The domestic equity market pulled back after the Nikkei Stock Average reached a year-to-date high of ¥22,307.58 at the close on 25 April. As concerns about trade contraction and economic slowdown intensified, risk-off moves strengthened and the market remained heavy.」

「As the US equity market plunged amid concerns about US interest-rate hikes toward year-end, the domestic equity market also plunged, closing at ¥19,155.74 on 25 December.」

「Subsequently, when the US equity market turned lower amid concerns over US-China trade friction, the domestic equity market also turned lower. As the US equity market then plunged amid growing concerns about US interest-rate hikes toward year-end, the domestic equity market also plunged, and the closing price at the end of the third-quarter consolidated accounting period was ¥20,014.77.」

「As the Company engages in trading for its own account that entails market risk, fluctuations in share prices, bond prices, interest rates, foreign exchange rates and other market prices may affect the operating results and financial condition of the Group.」

「As the Company engages in trading for its own account that entails market risk, fluctuations in share prices, bond prices, interest rates, foreign exchange rates and other market prices may affect the operating results and financial condition of the Group.」