Japan's Nikkei Experiences Its Most Devastating Day on Record
Japan’s Nikkei stock index experienced its largest single-day decline on Monday due to growing concerns over a potential recession in the US. Read Full Article at RT.com
TroibNews 
Stocks on the Tokyo exchange experienced a significant drop amid concerns about a potential recession in the US economy.
On Monday, Japan's Nikkei 225 index recorded its largest single-day drop, with fears over the US economic downturn contributing to a widespread selloff. The index fell by 12.4%, closing at 31,341.29, which represented a loss of 4,451.28 points — the highest point drop in its history. This downturn was reminiscent of the severe market crash on "Black Monday" in 1987. Similarly, the Tokyo Stock Price Index (Topix) declined by 12.23% on the same day.
This collapse followed a previous downturn on Friday, where the Nikkei fell 5.8% and Topix decreased by over 6%. As a result, the Nikkei wiped out all of its year-to-date gains and turned negative for the year.
The downturn was triggered by a report released on Friday demonstrating weak US employment data, amplifying recession fears.
“The scenario of higher unemployment constraining spending and further restraining hiring and incomes and economic activity leading to a recession is the feared scenario here,” said Tan Boon Heng of Mizuho Bank in Singapore.
The Japanese yen saw a rise in value, reaching 142.67 against the US dollar, a sharp increase from 146.45 late on Friday. This appreciation in the yen, typically seen as unfavorable for Japanese exporting companies, added to the market pressures.
“The market was also weighed down by the yen’s appreciation against the dollar and as expectations for exporters’ upbeat financial results receded,” noted IwaiCosmo Securities in a conversation with the South China Morning Post.
Additionally, last week, the Bank of Japan increased interest rates for the second time in 17 years, in contrast to the expected rate cut by the US Federal Reserve in September.
Concerns about the US’s economic stability have affected global markets, as evidenced by the 0.2% drop in Hong Kong's Hang Seng index and a sharp 12.8% fall in Australia's S&P/ASX 200. The MSCI World index, representing Asia-Pacific shares outside Japan, also saw a decline of 4.2%.
Camille Lefevre for TROIB News
On Monday, Japan's Nikkei 225 index recorded its largest single-day drop, with fears over the US economic downturn contributing to a widespread selloff. The index fell by 12.4%, closing at 31,341.29, which represented a loss of 4,451.28 points — the highest point drop in its history. This downturn was reminiscent of the severe market crash on "Black Monday" in 1987. Similarly, the Tokyo Stock Price Index (Topix) declined by 12.23% on the same day.
This collapse followed a previous downturn on Friday, where the Nikkei fell 5.8% and Topix decreased by over 6%. As a result, the Nikkei wiped out all of its year-to-date gains and turned negative for the year.
The downturn was triggered by a report released on Friday demonstrating weak US employment data, amplifying recession fears.
“The scenario of higher unemployment constraining spending and further restraining hiring and incomes and economic activity leading to a recession is the feared scenario here,” said Tan Boon Heng of Mizuho Bank in Singapore.
The Japanese yen saw a rise in value, reaching 142.67 against the US dollar, a sharp increase from 146.45 late on Friday. This appreciation in the yen, typically seen as unfavorable for Japanese exporting companies, added to the market pressures.
“The market was also weighed down by the yen’s appreciation against the dollar and as expectations for exporters’ upbeat financial results receded,” noted IwaiCosmo Securities in a conversation with the South China Morning Post.
Additionally, last week, the Bank of Japan increased interest rates for the second time in 17 years, in contrast to the expected rate cut by the US Federal Reserve in September.
Concerns about the US’s economic stability have affected global markets, as evidenced by the 0.2% drop in Hong Kong's Hang Seng index and a sharp 12.8% fall in Australia's S&P/ASX 200. The MSCI World index, representing Asia-Pacific shares outside Japan, also saw a decline of 4.2%.
Camille Lefevre for TROIB News
