Nikkei Slides 3% Amid Chip Slump and Yen Surge
The Nikkei 225, a key stock index in Japan, experienced a significant drop on Monday, with technology issues and a stronger yen contributing to investor concerns. The index fell by 1,142.30 points, a 2.88 percent decline from the previous trading day, ending at 38,546.64. Similarly, the broader Topix index saw a decrease of 83.92 points.
Chip-related stocks took a notable hit, following a downturn in U.S. tech stocks, including a 4% drop in the Philadelphia Semiconductor index on Friday. Major Japanese tech firms such as Tokyo Electron and SoftBank Group saw declines in their share prices. This sell-off in technology shares, combined with a strengthening yen, which rose against the dollar, fueled anxiety over the impact on exporters' earnings.
Amidst market volatility, there is speculation that the Bank of Japan (BOJ) may be considering a shift in its monetary policy. With expectations of significant wage increases, reports suggest the BOJ might end its negative interest rate policy in the near future. This potential policy change has contributed to the yen's appreciation and has influenced market dynamics. The Topix index also reflected the day's losses, closing down 2.2% at 2,666.83.
