FX.co ★ Japanese Shares Fall on Inflation Worries

The Nikkei 225 Index slipped 0.6% to close at 65,481, while the broader Topix Index fell 1.72% to 4,041 on Tuesday, extending the previous session’s losses. Sentiment remained pressured as global bond yields stayed elevated amid concerns that energy-driven inflation could prompt tighter monetary policy.

Oil prices resumed their upward trajectory after Iranian officials reportedly cast doubt on the likelihood of reaching an agreement before the US midterm elections in November, following President Donald Trump’s rejection of Tehran’s latest proposal. Japanese equities were further weighed down by technical factors, with more than half of Topix constituents trading ex-dividend.

Losses were pronounced in heavyweight technology, financial, and consumer names, including SoftBank Group (-3.4%), Mitsubishi UFJ (-3.5%), Sumitomo Mitsui (-4%), Toyota Motor (-3.5%), and Nintendo (-1.3%).