The Nikkei 225 Index Closes 1.27% Lower

The Nikkei 225 Index declined 0.6% to below 60,200 on Tuesday, pulling back from recent record highs after the Bank of Japan left its policy rate unchanged at 0.75% for a fourth straight meeting, in line with expectations. The central bank also raised its inflation outlook while lowering its FY2026 growth projections to reflect the economic impact of the Middle East conflict. Notably, three of the nine policy board members advocated for a rate hike, underscoring growing concern over inflationary pressures linked to the Iran war. Geopolitical developments remained in focus after Iran submitted a new proposal to the US, though disagreements over Tehran’s nuclear program continue to pose a major hurdle. On the corporate side, Advantest dropped around 5% despite strong earnings. SoftBank Group tumbled nearly 10% amid renewed concerns over the artificial intelligence sector. Other notable decliners included Hitachi (-5.8%), Tokyo Electron (-4.1%), and Fanuc Corp (-4.1%).

The Nikkei 225 Index fell 769 points or 1.27 percent on Tuesday to close at 59769 points. Leading the losses are Softbank (-10.06%), Nitto Denko (-8.45%) and Renesas Electron (-6.10%).

The Nikkei 225 Index declined 0.6% to below 60,200 on Tuesday, retreating from recent record highs after the Bank of Japan left its policy rate unchanged at 0.75% for a fourth consecutive meeting, in line with expectations. The central bank also raised its inflation forecast while lowering growth projections for FY2026 to reflect the economic impact of the Middle East conflict, which is expected to weigh on corporate profits and erode households’ real income. Sentiment was also shaped by ongoing geopolitical developments after Iran submitted a new proposal to the US, which is currently under review by the White House, though disagreements over Tehran’s nuclear program remain a key obstacle. On the corporate front, Advantest fell around 5% despite strong earnings results. Other notable decliners included SoftBank Group (-5.1%), Hitachi (-6.4%), and Fanuc Corp (-3%).