The Nikkei Average fell sharply for a second straight session in the morning session on the 19th, with the session close pushed down to ¥65,724.25. Declines in semiconductor stocks led the broader market lower, with the index falling as low as ¥65,326.76. Heightened US-Middle East tensions and a sharp drop in the SOX were cited as the backdrop.
The Nikkei Stock Average fell sharply in the morning session on the Tokyo Stock Exchange, closing at ¥65,724.25. It ended trading ¥1,736.48, or 2.57%, below the previous business day’s close.
Declines in semiconductor-related stocks in particular weighed on the broader market, sending the Nikkei Average down as much as ¥2,133.97 to ¥65,326.76. Selling driven by the trend in US markets, including the sharp drop in the SOX, was pronounced.
More than 80% of stocks on the TSE Prime Market declined, indicating a weakening sentiment among market participants. Semiconductor-related stocks were notably weak, and the market overall trended lower apart from part of the pharmaceutical sector.
Maki Sawada (澤田麻希) of Nomura Securities said the sharp drop in the SOX weighed on the broader market through its impact on semiconductor stocks. At the same time, she said that VIX levels did not indicate excessive pessimism and that the market was not in a severe correction phase. Higher oil prices remaining elevated and expectations for higher interest rates ahead were identified as factors that could weigh on share prices going forward.