Views are spreading that the Nikkei will find a bottom and rebound, while oil prices are expected to remain high. COP31 will begin in Antalya, Turkey, from the 9th to the 20th.
The Nikkei fell for a fifth straight day the previous weekend, closing at ¥57,434.77 and dipping below ¥60,000, with the decline in closing-price terms ranking as the third-largest on record. Although selling emerged in AI-related stocks, some observers point to the possibility of buybacks prompted by their perceived undervaluation.
In the oil market, concerns about a large-scale attack on Iran eased, but the impact of the Middle East situation could persist for an extended period. WTI futures remained elevated at $90.83 per barrel and North Sea Brent at $98.32. Brent was approximately 54.5% higher than on the same day a year earlier.
Regarding domestic and international supply-demand trends, Japan has a high dependence on crude oil transported through the Strait of Hormuz, and a gasoline subsidy of ¥51.9 per liter has applied since 5 November. Measures have therefore been taken to curb the direct impact of high crude oil prices.
Supply in Asian markets is expected to increase as South Korea eases restrictions on diesel exports and China adds to its export quotas, while gasoline and diesel prices are expected to fall sharply in the Philippines next week.
COP31 will be held in Antalya from the 9th to the 20th, with progress on adaptation measures and the funding gap for the loss and damage response fund among the main agenda items. The Japanese government plans to establish a Japan Pavilion to advance discussions on measures to combat global warming.