Japan's Nikkei 225 Dropped 3% Following Intense Sell-off In Semiconductor Stocks

Akira Ito
16 Jul, 2026
Tokyo

Japan's indexes faced selling pressure and ended a two-day rally amid renewed weakness in semiconductor-related stocks. 

The Nikkei 225 stock average decreased 2.5%, the broader TOPIX declined 1%, and the yen hovered at 162.11 against the U.S. dollar. 

The weakness in memory module makers and advanced chipmakers in overnight trading in New York rippled to Asian markets, as investors questioned the sustainability of the artificial intelligence trade. 

Escalating tensions in the Middle East also weighed on the market sentiment, and soaring crude oil prices raised the prospect of higher interest rates later in the year. 

The Brent crude oil price decreased 0.7% to $84.40 a barrel and traded volatile after the U.S. and Iran exchanged heavy artillery fire over the Strait of Hormuz. 

The five-monthlong war in the Middle East has stoked fears of a wider war in the region and prolonged disruptions in commercial shipments through the narrow passageway, a key route for about 20% of global oil and gas exports. 

The import-energy-dependent economy of Japan is likely to face upward price pressure as higher energy prices travel through broader sectors of the economy. 

Japan's 10-year government bond yield held around 2.69% after Finance Minister Satsuki Katayama proposed including investments in government bonds in a tax-free investment program for individual investors. 

The finance minister urged the country's massive pension fund to increase its exposure to Japan's government bonds, as the government prepares to expand its fiscal budget. 

 

Japan Indexes and Stocks 

The Nikkei 225 Stock Average decreased 2.5% to 67,004.28, and the broader TOPIX declined 1% to 4,045.09. 

Kioxia Holdings declined 13.6% to ¥63,120.0, Tokyo Electron dropped 6.5% to ¥69,520.0, Advantest Corp. decreased 5.8% to ¥29,680.0, and Fujikura Ltd. fell 6.4% to ¥4,798.0. 

Nippon Yusen KK decreased 1.3% to ¥5,540.0, Mitsui OSK Lines declined 1.6% to ¥5,504.0, and Kawasaki Kisen Kaisha dropped 1.6% to ¥2,632.50.