The Nikkei 225 is expected to remain near its lows in afternoon trading. The decline in the morning session exceeded ¥1,800, and views are emerging that accelerating U.S. PPI, rising long-term interest rates and higher oil prices will weigh on investor sentiment.
The Nikkei 225 is expected to remain near its lows in afternoon trading, with the decline from the morning session's close projected to widen. The index stood at 63,469.39 during the day, down 1,801.56 from the previous day, and views are that it will continue searching for a floor.
One factor behind the market weakness is the acceleration in the U.S. producer price index (PPI). In the Treasury's long-term bond buyback program, the amount purchased fell short of the upper limit, causing long-term interest rates to rise further. This has fueled growing views that upward pressure from inflation and higher interest rates will weigh on the stock market.
In addition, the situation surrounding the Red Sea port city of Mocha is expected to drive crude oil prices higher, further undermining investor sentiment. Selling pressure may intensify, particularly in semiconductor-related stocks.