Tokyo stocks experienced a significant downturn on Thursday morning as market participants responded to losses on Wall Street and the rise in U.S. Treasury yields. The Nikkei Stock Average dropped below the 70,000 mark, closing at 69,373.40 after a decline of 662.31 points, or 0.95%, from the previous day. Similarly, the broader Topix index saw a decrease of 62.02 points, or 1.49%, settling at 4,092.09.
The decline was largely driven by investor concerns that increased U.S. borrowing costs could dampen consumer spending and business investments. The yield on the 10-year U.S. Treasury reached 5.36%, marking its highest level since April 2002, which added pressure on global markets, including Japan’s.
Domestically, Japan’s benchmark 10-year government bond yield remained above 3%, further contributing to the pressure on equities. This rise in yields is seen as a deterrent for market investments, as higher yields often lead investors to favor bonds over stocks.
Adding to the market’s woes, concerns over crude oil supplies resurfaced following attacks on two airports in Saudi Arabia by Iran-aligned Houthi forces. These geopolitical tensions have further shaken investor confidence, contributing to the broader market sell-off observed.
As most sectors recorded losses, the market sentiment remained bearish. The dual impact of international developments and domestic pressures suggests ongoing volatility in the Tokyo stock market. Investors continue to monitor global economic signals and geopolitical developments for future market direction.