The Nikkei Stock Average Volatility Index (Nikkei VI) fell sharply, but caution remained strong and did not ease during trading hours before declining sharply again toward the close.
The Nikkei VI fell sharply on the 27th, down 6.80 from the previous day, or 19.73%, to 27.66. It traded between a high of 34.95 and a low of 27.66.
Buying led in the Tokyo market following gains in U.S. stocks, but caution over uncertainties surrounding the outlook for the Middle East, concerns about excessive AI investment and information leaks meant that sentiment remained strongly wary of a rise in volatility.
The Nikkei VI is an indicator of market participants' expectations for future volatility and generally tends to be negatively correlated with the Nikkei 225. Today, however, it remained close to the previous day's level during trading hours.
At the close, the Nikkei VI was reported to have fallen sharply. With domestic and overseas policy-rate announcements due this week, the market is expected to remain subject to numerous factors warranting caution.