Japan’s Stocks Fall on US Economic Worries with Tech, Banks Weak
Japanese stocks fell as growing concerns about the impact of US President Donald Trump’s tariff policy on the global economy fueled risk-off sentiment.
Exporters like tech companies and autos dropped on fears about a worsening global trade war, while banks fell as investors rotated out of outperforming stocks to cover losses elsewhere.
Topix fell 1.1% to 2,670.72 as of market close in Tokyo
Earlier dropped as much as 2.98%, the biggest intraday fall since Sept. 30
Nikkei 225 declined 0.6% to 36,793.11
Out of 1,693 stocks in the Topix, 411 rose and 1,236 fell, while 46 were unchanged.
Retailers Pan Pacific International and Monotaro were bright spots after logging a jump in monthly sales for February, helping the Topix pare some of its losses in afternoon trade.
Globally-exposed shares like Toyota, Fujitsu and Sony were among the Topix’s heaviest drags. A fall in US stocks Monday, with the Nasdaq 100 recording its worst day since 2022, hurt sentiment among Japanese investors, said Hiroshi Namioka, chief strategist at T&D Asset Management. “Japan’s market is in a totally risk-off environment,” he said.
Caution also set in ahead of Trump’s steel and aluminum tariffs, scheduled to come into effect Tuesday, Namioka added. Metal parts manufacturers Sumitomo Electric and Furukawa Electric dropped over 4%.
Bank shares, which had been outperforming so far this year on expectations that rate hikes by the Bank of Japan will boost earnings, were also among Tuesday’s biggest losers. Mizuho dropped 3.7%, the most since September.
“There’s some reversal trading going on,” said Tomoaki Kawasaki, a senior analyst at IwaiCosmo Securities. “Stocks that were strong are being sold, whereas those that haven’t risen as much seem quite steady.”
The yen’s recent strengthening against the dollar may also be dampening hopes of further BOJ rate hikes and pressuring bank stocks, as many see the policy as a response to excessive yen weakening, Kawasaki added.
Source: Bloomberg
