The Nikkei 225 Index Closes 2.60% Lower

The Nikkei 225 Index dropped 2.85% to close at 64,325 on Wednesday, hitting four-week lows as surging global bond yields and oil prices weighed heavily on equities. Oil prices climbed for a third consecutive session amid escalating hostilities between the US and Iran, heightening inflationary risks and pushing global bond yields higher. Japan’s 10-year government bond yield reached 3% for the first time since 1996, also supported by growing expectations for a Bank of Japan interest rate hike. Governor Kazuo Ueda said this week that policymakers need to pay greater attention to upside price risks when conducting monetary policy, signaling that a rate increase is likely later this month. Tech and AI-related stocks led the decline, with notable losses from Advantest (-2.5%), Fujikura (-3.9%), Taiyo Yuden (-4.6%), Tokyo Electron (-3.4%) and SoftBank Group (-6.4%). Financial, consumer and industrial stocks also recorded sharp declines.

The Nikkei 225 Index fell 1720 points or 2.60 percent on Wednesday to close at 64495 points. Leading the losses are Sumitomo Metal Mining (-11.19%), Kyowa Hakko Kirin (-10.81%) and Mitsubishi Materials (-10.41%).

Asian equity markets fell sharply on Wednesday, tracking Wall Street lower as a surge oil prices heightened concerns over inflation and imminent interest rate hikes. Global bond yields also rallied on mounting inflation worries, expectations of monetary tightening and worsening fiscal conditions, pressuring equities further. Tech-heavy indexes in South Korea and Japan dropped about 3%, leading regional declines. Shares in Australia, China and Hong Kong also slumped.