Tokyo’s stock market experienced a significant downturn on Thursday morning as the Nikkei Stock Average fell below the 70,000 threshold, influenced by overnight losses on Wall Street and escalating U.S. Treasury yields. The 225-issue Nikkei Stock Average dropped 662.31 points, or 0.95%, settling at 69,373.40, while the broader Topix index declined by 62.02 points, or 1.49%, to 4,092.09.
The market’s decline was largely driven by investor concerns over rising U.S. borrowing costs, which could potentially dampen consumer spending and business investments. The yield on the 10-year U.S. Treasury note climbed to 5.36%, marking its highest level since April 2002. In Japan, the benchmark 10-year government bond yield also remained above 3%, adding further pressure on domestic equities.
Additionally, market sentiment was unsettled by apprehensions regarding crude oil supplies. These concerns emerged following attacks on two airports in Saudi Arabia, attributed to Iran-aligned Houthi forces, raising fears of disruptions in oil distribution.
Most sectors on the Tokyo Stock Exchange recorded losses as these combined factors weighed heavily on investor confidence. The situation underscores the interconnectedness of global financial markets and how developments in one region can ripple across others, affecting market dynamics and investor behavior.