FX.co ★ Japanese Shares Track Wall Street Lower

On Friday, the Nikkei 225 declined by 2% to approximately 34,000, while the Topix Index experienced a 2.3% reduction, settling at 2,510. This downturn continued the losses observed in the previous session, marking the indices' lowest points in roughly eight months. Japanese stocks mirrored the significant sell-off on Wall Street overnight, which obliterated $4 trillion in market capitalization. This was prompted by US President Donald Trump's extensive tariff impositions, raising fears of an escalating trade war and the potential for a global economic downturn. The tariffs include a 24% charge on Japanese imports and a 25% duty on automobile exports, severely impacting Japan’s export-reliant economy, especially its automotive industry. In reaction, Trade Minister Yoji Muto indicated Japan’s intention to pursue tariff exemptions and introduced a task force to evaluate their implications. Financial sectors were notably impacted, with significant losses reported from Mitsubishi UFJ (-8.3%), Sumitomo Mitsui (-7.5%), and Mizuho Financial (-9.3%). Additionally, shares in major auto, technology, and retail sectors encountered substantial selling pressure.