Japanese Market Indexes Expected To Trade Volatile Tracking Yen Turbulence

Akira Ito
15 Jul, 2024
Tokyo

Benchmark indexes in Tokyo dropped sharply in Friday's trading after the yen jumped more than 3%. 

The Nikkei 225 stock average and the Topix declined between 2% and 1%, respectively. 

Financial markets are closed on Monday in Japan for a public holiday. 

The suspected market intervention by the Bank of Japan and the ministry of finance lifted the battered yen to 157.85 against the U.S. dollar for the second session in a row. 

Moreover, the Bank of Japan stepped up pressure on currency traders and conducted exchange rate verification for the euro-yen trade. 

The Bank of Japan has been struggling to balance its government bond purchase plan while keeping the yen from falling rapidly. 

However, mixed messages from the Bank of Japan policymakers exacerbated the yen weakness due to the wide yield differential between Japanese and U.S. government bonds. 

Tech stocks were among the leading decliners in Friday's trading, following the weakness in the sector after investors rotated out to smaller company stocks in New York. 

In other economic news in the region, China's economic growth and retail sales in the second quarter fell short of market expectations.

Growth in the second quarter in the world's second-largest economy slowed to 4.7%, and retail sales slowed to 2% in June, the government data showed. 

Moreover, fixed-asset investment growth eased to 3.9% in the first five months of May after property market investment plunged sharply from a year ago. 

Moreover, the jobless rate held at 5% in June, matching the rate in the previous month. 

 

Japan Stock Movers 

In Friday's trading, the Nikkei 225 stock average dropped 2.5% to 41,190.68, and the Topix index declined 1.1% to 2,894.56. 

Tokyo Electron, Advantest, Disco Corp., Lasertec, and SoftBank declined between 2% and 4%.