The Nikkei 225 fell sharply for a second consecutive session in Tokyo trading on the 11th, with its decline widening to more than ¥1,900 in the afternoon. Lower U.S. stocks, higher oil prices and renewed geopolitical risks dampened investor sentiment, while a wait-and-see mood spread ahead of next week's FOMC meeting and Bank of Japan policy meeting.
The Nikkei 225 fell sharply for a second consecutive session in Tokyo trading on the 11th, with its decline widening to more than ¥1,900 in the afternoon. In addition to lower U.S. stocks the previous day, escalating tensions in the Middle East, higher oil prices and rising U.S. long-term interest rates weighed on investor sentiment. With U.S. CPI due to be released tonight and next week's FOMC meeting and Bank of Japan policy meeting approaching, investors refrained from making aggressive purchases.
The afternoon session opened at ¥63,361.04, down ¥1,909.91 from the previous day, and traded slightly below the morning close. Nikkei 225 futures moved within a range, while the cash market lacked a clear direction. The dollar-yen rate generally remained in the ¥154 range.
By sector, nonferrous metals, electrical equipment and precision instruments were the biggest decliners in the afternoon. Mining, marine transportation and insurance rose. Selling intensified, particularly in semiconductor-related stocks, with Resonac Holdings, Advantest, IBIDEN, KOKUSAI ELECTRIC and Kioxia Holdings among the stocks posting sharp declines.
Higher oil prices and geopolitical risks weighed on the stock market, with reports of Saudi Arabia's low August production and concerns over Iran putting pressure on prices. The yen weakened further against the dollar, creating some positive factors for exporters' earnings outlooks, but this was not enough to overturn the overall risk-off mood.