The Nikkei Average suffered a sharp third consecutive decline in Tokyo trading on 2 September, opening at ¥65,195.43 shortly after the market opened. It then extended its losses, briefly falling below ¥65,000.
The Nikkei Average suffered a sharp third consecutive decline in Tokyo trading on 2 September. It opened at ¥65,195.43 shortly after the market opened and at one point fell below ¥65,000 during the morning session. Selling dominated as declines in the previous day's US markets, rising crude oil futures prices and higher domestic long-term interest rates weighed on the market.
The Dow, Nasdaq and S&P 500 all declined in the US market, with geopolitical risk surrounding the US attack on Iran and higher oil prices weighing on share prices. In Tokyo, the dollar-yen exchange rate also remained in the lower ¥160 range, maintaining a weaker-yen trend.
Caution also spread in futures and interest-rate movements related to the Nikkei Average. The yen-denominated settlement value of Chicago Nikkei futures remained weak. Rising domestic long-term interest rates provided a selling factor, particularly for growth stocks, affecting investor sentiment.
From a technical perspective, the 75-day moving average was watched as resistance on the upside, while the 25-day moving average was seen functioning as support on the downside. Some market participants believed that the room for further downside during the day was limited at this point.