Japanese Shares Turn Lower as Yen Rallies Further

The Nikkei 225 Index fell 0.19% to close at 65,143 on Wednesday, giving up earlier gains as the yen strengthened further to its highest level in nearly seven months. The move came after US Treasury Secretary Scott Bessent warned traders against betting on further yen weakness, saying he has “pretty good insight” into the Bank of Japan’s actions when intervening in the currency market. A stronger yen weighs on the earnings outlook for Japan’s export-oriented companies and makes Japanese assets more expensive for overseas investors. Meanwhile, oil prices continued to climb amid escalating Middle East tensions, raising inflation concerns and strengthening expectations for interest rate hikes. Notable declines included Advantest (-2.8%), Mitsubishi UFJ (-1.5%), Nintendo (-4%) and Fast Retailing (-2.7%).

The Nikkei 225 Index fell 179 points or 0.27 percent on Wednesday to close at 65090 points. Leading the losses are Kyowa Hakko Kirin (-5.25%), Dena (-4.35%) and Sumitomo Dainippon (-4.12%). Top gainers were Furukawa Electric (12.71%), Tokai Carbon (9.08%) and Fujikura (8.58%).

The Nikkei 225 Index climbed 0.6% to above 65,600, while the broader Topix Index advanced 0.4% to 4,066 on Wednesday, recovering from the previous session’s losses as technology stocks led the rebound. Investors also welcomed private-sector data showing Japanese manufacturers’ sentiment improved for a second consecutive month in September, supported by solid demand for semiconductors and data centers. Meanwhile, rising oil prices continued to fuel inflation concerns and strengthen expectations for higher interest rates. Markets also kept a close eye on the yen after the currency rose to its strongest level in nearly seven months. Technology and artificial intelligence-related stocks posted notable gains, with SoftBank Group rising 2.8%, Fujikura up 8.7%, Lasertec gaining 4.2%, Ibiden Co advancing 1.6% and Furukawa Electric surging 11.1%.