Japan Market Daily

On August 31, 2026, Tokyo's Nikkei 225 edged lower, closing down 93.63 points (-0.14%) at 66,311.93, while the TOPIX extended its gains, rising 9.58 points to 4,156.29. The index opened 737 points lower on the previous week's weakness in US technology shares and rising long-term interest rates in both Japan and the United States, and at one point fell more than 1,500 points to 64,832.10, slipping below 65,000 for the first time in four sessions. It then finished at the day's high as bargain hunting after the rapid decline, a recovery in South Korea's KOSPI and buybacks in futures came in. Auto shares on the weaker yen and bank shares on higher rates also lent support, and 22 of the 33 sector indexes rose. Advantest and TDK alone subtracted about 398 points from the index, while Fast Retailing, Kioxia and Recruit held firm. USD/JPY reached 160.20 in the morning, its highest in about a month, before pulling back to around 159.73.

On August 28, 2026, Tokyo's Nikkei 225 rebounded, closing up 273.58 points (+0.41%) at 66,405.56, while the TOPIX rose for a third day, adding 29.49 points to 4,146.71. Gains in the US market the previous day on Nvidia's strong earnings carried over, and AI and semiconductor-related shares were bought. Advantest, Recruit Holdings, Tokyo Electron, Konami Group and TDK together added about 302 points to the index, while Kioxia, Fujikura and SoftBank Group declined. On the TSE Prime Market 873 issues advanced and 631 declined, with trading value at 8.1223 trillion yen. The Ministry of Internal Affairs and Communications reported that the core Consumer Price Index for Tokyo's 23 wards rose 1.8% year-on-year in August, accelerating from 1.7% in July but staying below 2% for a seventh straight month. USD/JPY firmed to around 159.56 ahead of Fed Chair Warsh's Jackson Hole speech.

On August 27, 2026, Tokyo's Nikkei 225 fell for the first time in three sessions, closing down 130.18 points (-0.20%) at 66,131.98, while the TOPIX rose for a second day, gaining 6.20 points to 4,117.22. Nvidia's May-July results, released after the US close on the 26th, beat market forecasts with revenue up 106% year-on-year at 96.2 billion dollars and August-October guidance of 108 billion dollars, but after climbing to 66,954.69 in early trading the index was sold on a sense that the news was already priced in, falling to 65,782.59 shortly after 10 a.m. Kioxia Holdings and Tokyo Electron supported the index, while Advantest and Fast Retailing alone subtracted about 309 points. Trading value on the TSE Prime Market was 7.87 trillion yen. Bank of Japan Deputy Governor Himino said consumer price inflation is expected to stay above 2% year-on-year in the second half of the fiscal year, and USD/JPY rose to around 159.39 after his speech.

On August 26, 2026, Tokyo's Nikkei 225 rose for a second straight session, closing up 405.73 points (+0.62%) at 66,262.16, while the TOPIX rebounded 17.35 points to 4,111.02. The market opened lower on the previous day's weakness in US semiconductor shares, hitting a session low of 65,390.55 at 10 a.m., but reports of an interim agreement between Iran and Oman eased concerns over the Middle East, and support from financial stocks and firmer overseas markets lifted the index to 66,386.32 in the afternoon. Advantest, SoftBank Group and Recruit Holdings drove the index higher, while Fast Retailing and Kioxia Holdings declined. The biggest percentage gainer on the TSE Prime Market was Daiichi Kigenso Kagaku-Kogyo, which jumped 23.91% after announcing it had established domestic manufacturing technology for rare metals. Trading value was the lowest in about four months. USD/JPY fell to 158.88 in the morning on lower crude oil prices.

On August 25, 2026, Tokyo's Nikkei 225 rebounded for the first time in three sessions, closing up 328.34 points (+0.50%) at 65,856.43, while the TOPIX slipped for a second day, edging down 1.79 points to 4,071.50. In the US on the 24th, the Dow rose about 140 dollars, but semiconductor shares were sold on caution ahead of Nvidia's earnings, leaving the Nasdaq Composite down about 200 points and the Philadelphia Semiconductor Index off as much as 4% at one point. In Tokyo, bargain hunting emerged in heavily sold names, with SoftBank Group, Ibiden, Fujikura and Tokyo Electron lifting the index and Furukawa Electric surging 10%. On the other side, Fast Retailing, Advantest and Toyota Motor declined. Trading value on the TSE Prime Market came to about 7.0099 trillion yen, the lowest in roughly four months since April 21. USD/JPY traded in the lower 159 range.

On August 24, 2026, Tokyo's Nikkei 225 fell for a second straight session, closing down 488.27 points (-0.74%) at 65,528.09. Selling dominated on higher long-term interest rates in both Japan and the United States and on weakness in South Korean equities. South Korea's KOSPI dropped 3.12% to close at 6,696.96, led by an 8.7% plunge in Samsung Electronics, and semiconductor and AI-related names were sold in Tokyo as well, with Kioxia Holdings down 6.24% and SoftBank Group down 5.33%. Advantest and SoftBank Group alone subtracted about 563 points from the index. On the other hand, advancers outnumbered decliners on the TSE Prime Market at 841 to 658, 20 of the 33 sector indexes rose, and Tokyo Electron and Recruit Holdings were bought. Investors stayed on the sidelines ahead of Nvidia's earnings on the 26th and Fed Chair Warsh's Jackson Hole speech on the 28th. USD/JPY softened to around 158.71 in the morning.

On August 21, 2026, Tokyo's Nikkei 225 fell, closing down 200.43 points (-0.30%) at 66,016.36, while the TOPIX edged up 7.56 points to 4,067.29 for a second straight gain. In the US on the 20th, the Dow tumbled 703 dollars as Walmart's post-earnings plunge stoked concerns about American consumer spending, and consumer-related stocks in Tokyo such as Fast Retailing and Ryohin Keikaku were sold, pushing the Nikkei down more than 900 points at one point. Losses were pared after the initial selling ran its course, supported by a firm South Korean KOSPI, buybacks in AI and semiconductor stocks such as Advantest and Kioxia Holdings, and inflows into mining, oil and coal products, and shipping on higher oil prices, allowing the index to close back above 66,000. Japan's July nationwide core Consumer Price Index rose 1.8% year-on-year, matching market forecasts and accelerating from June's 1.6%. USD/JPY rose to 159.13 in the morning before softening to 158.73 by early evening as US long-term yields stayed low.

On August 20, 2026, Tokyo's Nikkei 225 rebounded for the first time in three sessions, closing up 890.37 points (+1.36%) at 66,216.79, with gains reaching nearly 1,000 points at one stage. The TOPIX also rose 47.42 points to 4,059.73. In the US on the 19th, the Treasury announced it would at least double the size of each liquidity-support buyback operation for long-dated Treasuries, sending long-term yields lower and lifting all three major indexes. Tokyo followed suit, with bargain-hunting buybacks dominating after the Nikkei had fallen nearly 3,900 points over the previous two sessions, and buying spread broadly across the market. A sharp rally in South Korea's KOSPI provided further support. The minutes of the July FOMC meeting showed many participants judged that additional rate hikes would likely be necessary if inflation failed to decline, but rate-hike expectations receded given the recent softening in inflation data. USD/JPY fell to 158.05 in overseas trading before edging higher in the low-to-mid 158 range in Tokyo. Japan's July trade balance showed a deficit of 634.5 billion yen.

On August 19, 2026, Tokyo's Nikkei 225 fell sharply for a second straight session, closing down 2,134.31 points (-3.16%) at 65,326.42, dropping below 66,000 on a closing basis for the first time in about two weeks since the 7th. The TOPIX also fell more than 3%, down 127.91 points to 4,012.31. Profit-taking accelerated in AI and semiconductor stocks following the US market on the 18th, where the Dow fell 116 dollars for a third straight session and the Philadelphia Semiconductor Index (SOX) plunged nearly 5%. President Trump posted on social media on the 18th that there were no ongoing or planned talks or dialogue with Iran, renewing Middle East risk concerns. The US 30-year Treasury yield hit a 19-year high and Japan's long-term rate rose to 2.945%, a roughly 30-year high, making high-PER tech stocks look relatively expensive. South Korea's KOSPI plunged nearly 7% at one point, triggering a sidecar, further chilling sentiment. SoftBank Group and Advantest alone dragged the index down by about 687 points, while Kioxia Holdings fell more than 12%. USD/JPY traded softly in a range of 159.11 to 159.64.

On August 18, 2026, Tokyo's Nikkei 225 fell sharply for the first time in six sessions, closing down 1,759.52 points (-2.54%) at 67,460.73, with losses exceeding 1,800 points at one stage. The TOPIX also fell for a second session, down 43.89 points to 4,140.22. The 60-day negotiations between the US and Iran aimed at ending hostilities expired on the 17th, and President Trump indicated he would not seek an extension, deepening uncertainty over the Middle East. Japan's long-term interest rate rose to 2.945% at one point, its highest in about 30 years, and the combination made high-PER semiconductor stocks look relatively expensive. Advantest and Tokyo Electron alone dragged the index down by about 836 points. Among Nikkei constituents, 80 rose and 142 fell. On the other hand, mining, oil and coal products, and shipping stocks were bought on higher oil prices, and funds also flowed into defensive names such as pharmaceuticals. USD/JPY traded between the 159.30 and 159.74 levels. WTI crude hovered around $85 per barrel.

On August 17, 2026, Tokyo's Nikkei 225 rose for a fifth straight session, closing up 506.45 points (+0.74%) at 69,220.25, recovering the 69,000 level on a closing basis for the first time in about a month since July 6. The TOPIX, however, fell 13.09 points to 4,184.11, with decliners outnumbering advancers and trading value slipping below 9 trillion yen to 8.9492 trillion. In the US on August 14, the Dow fell 107 dollars, but July retail sales unexpectedly declined from the previous month and the August University of Michigan consumer sentiment index fell for the first time in three months, pushing back expectations of an early Fed rate hike, which Tokyo took as a positive. In the afternoon session, buying deepened in high-priced AI and semiconductor stocks such as Advantest and Tokyo Electron, which together lifted the index by about 251 points. Kioxia Holdings rose 15.00%. USD/JPY fell to 158.95 in the morning before hovering around 159. Japan's 10-year government bond yield rose to around 2.93%, its highest level in roughly 30 years.

On August 14, 2026, Tokyo's Nikkei 225 rose for a fourth straight session, closing up 405.21 points (+0.59%) at 68,713.80. The TOPIX gained 21.16 points to 4,197.20, setting another consecutive record high. Buying continued in high-priced semiconductor and AI stocks, carrying over from the Nasdaq's rise in the US on the 13th driven by a slowdown in the July Producer Price Index, lower oil prices, and falling long-term yields. The Nikkei rose as high as 69,608.24 intraday, recovering the 69,000 level for the first time in about a month since July 13, but lost momentum as South Korea's KOSPI pared its gains. Weekend position-squaring and expectations of an additional Bank of Japan rate hike in September also weighed, and the index slipped to 68,471.15 in the mid-afternoon session. The day marked the calculation of the August options special quotation (SQ), and domestic corporate April-June earnings announcements concluded. USD/JPY moved narrowly in a range of 159.15 to 159.51. WTI crude had fallen $2.02 the previous day to $81.25 per barrel.

On August 13, 2026, Tokyo's Nikkei 225 rose for a third straight session, closing up 784.53 points (+1.16%) at 68,308.59. Gains exceeded 1,200 points at one point, and the index closed above 68,000 for the first time since July 15. The TOPIX rose 37.04 points to 4,176.04, marking a seventh straight gain and a second consecutive record close. The US July Consumer Price Index released on the 12th matched market forecasts at +3.4% year-on-year for the headline figure and +2.5% for core, and the slowing pace pushed back expectations of an early Fed rate hike. Following gains in the Nasdaq and the Philadelphia Semiconductor Index (SOX, +2.49%), buying concentrated in high-priced chip stocks such as Advantest and Tokyo Electron, which together lifted the index by about 460 points. TOPPAN briefly hit its daily up-limit after reporting a 2.3-fold rise in April-June net profit. USD/JPY traded in the mid-159 range, while oil (WTI) rose to $83-84 per barrel on concerns over the Strait of Hormuz.

On August 12, 2026, Tokyo's Nikkei 225 extended its gains, closing up 553.84 points (+0.83%) at 67,524.06, while the TOPIX rose 38.39 points to 4,139.00, setting a new intraday all-time high during the session. AI, semiconductor, and banking stocks continued to attract buying on the back of receding Fed rate-hike expectations following the weak US jobs report on the 7th and the rise in the SOX index on the 10th. However, with market participation thin due to the Obon summer holiday, profit-taking capped gains, with advancers numbering only 916. USD/JPY briefly rose to 159.46 but moved in a narrow range as markets awaited the US July CPI report due in the evening Japan time (consensus: headline +3.4% year-on-year, core +2.5%). Japan's 2-year government bond yield rose to the 1.65% range, its highest level in 31 years, reflecting continued pricing-in of an additional Bank of Japan rate hike in September.

On August 10, 2026, Tokyo's Nikkei 225 rebounded sharply for the first time in three sessions, closing up 1,363.51 points (+2.08%) at 66,970.22, while the TOPIX rose 25.68 points to 4,100.61, briefly surpassing its all-time intraday high set on July 6. The rally followed the US market on August 7, where the July non-farm payrolls came in at -23,000 against a consensus forecast of +83,000, and average hourly earnings rose only 3.2% year-on-year against a 3.5% forecast, causing the Nasdaq to rise 1.30% and the S&P 500 to set a record close as expectations for an early Fed rate hike receded sharply. In Tokyo, semiconductor stocks including Advantest and Tokyo Electron led gains. Recruit Holdings surged to its daily up-limit (+22.79%) on strong earnings. USD/JPY climbed to the 158.40 range, fully recovering its post-payrolls drop. WTI crude had closed at $78.18 and gold at $4,399.70 on the 7th. With Tuesday a public holiday (Mountain Day), trading volume was thin ahead of the Obon summer break.

On August 7, 2026, Tokyo's Nikkei 225 fell slightly for a second straight session, closing down 76.55 points (-0.12%) at 65,606.71, while the TOPIX rose 19.08 points to 4,074.93. SoftBank Group, which had reported April-June net profit down 17.7% year-on-year to 347.3 billion yen after the previous day's close, fell sharply, and Lasertec also plunged after its full-year profit guidance came in below market expectations, briefly pushing the Nikkei down more than 1,000 points. However, buying in strong-earnings stocks kept more than 70% of Prime Market issues higher. USD/JPY traded narrowly in the mid-to-high 157 range. Market attention was focused on the US July jobs report due at 9:30pm Japan time (market consensus: non-farm payrolls +80,000, unemployment rate 4.2%), and position-squaring ahead of the weekend was limited. Oil (WTI) hovered in the $75 range.

On August 6, 2026, Tokyo's Nikkei 225 fell for the first time in three sessions, closing down 617.18 points (-0.93%) at 65,683.26, while the TOPIX rose 9.68 points to 4,055.85. Although the Dow extended its winning streak to five sessions in the US overnight, the Nasdaq and Philadelphia Semiconductor Index (SOX) fell, with AMD dropping 7.04% on its earnings and Alphabet declining 4.05% following the departure of a prominent AI researcher. This dragged on AI and semiconductor stocks including Kioxia Holdings in Tokyo, briefly pushing the Nikkei below 65,000. Losses were pared back in the afternoon on buying in strong-earnings stocks, with more than 70% of Prime Market issues ending higher. After the close, SoftBank Group reported April-June net profit of 347.3 billion yen, down 17.7% year-on-year. USD/JPY moved narrowly between 157.56 and 157.75, with little direction ahead of the US July jobs report due on the 7th. Oil (WTI) continued to fall, hovering around $75.56.

On August 5, 2026, Tokyo's Nikkei 225 extended its gains sharply, closing up 2,342.91 points (+3.66%) at 66,300.44, with the TOPIX rising 84 points to 4,046. The rally was driven by buying in AI and semiconductor stocks including Advantest, Tokyo Electron, and SoftBank Group (+13.96%), following a 6.55% surge in the US Philadelphia Semiconductor Index (SOX) and record closes in both the S&P 500 and Dow on the previous day. Ibiden surged to its daily up-limit (+24.49%) after announcing a major upward earnings revision and a stock split. A broadly firmer tone across Asian markets, including South Korea's KOSPI, also supported sentiment. US Treasury Secretary Bessent indicated that a deal to reopen the Strait of Hormuz could come as soon as that day or the next, pushing oil (WTI) down around 6% to the $75 range. USD/JPY moved narrowly around 157.50, with intervention wariness keeping the pair contained in the high-157 range.

On August 4, 2026, Tokyo's Nikkei 225 rebounded, closing up 202.63 points (+0.32%) at 63,957.53, while the TOPIX was little changed at 3,961.78. Supported by a partial reversal toward yen weakness, semiconductor, machinery, and heavy-industry stocks (Mitsubishi Heavy Industries, Fujikura, among others) that had fallen sharply the previous day rebounded, while banks, insurers, and trading companies remained weak even among those with strong earnings, as buying concentrated in large-cap tech names pushed the Nikkei/TOPIX (NT) ratio up to 16.14. In currency markets, suspected government and Bank of Japan yen-buying intervention drove USD/JPY down to 155.21 in Asian trading; Finance Minister Katayama said Japan was coordinating closely with the US Treasury and would not hesitate to conduct further joint intervention, and US Treasury Secretary Bessent likewise posted on X that the US stood ready to join future coordinated intervention. The pair later rebounded to 156.23 amid risk-off yen buying and falling oil futures after President Trump announced he was calling off a planned large-scale attack on Iran over the weekend and would resume talks. However, a stronger-than-expected US July ISM Manufacturing Index and a rally in US stocks on the avoided Iran strike pushed USD/JPY back up, ending at 157.80-157.82 at 5pm, up 1.04 yen from the previous day. Oil (WTI) briefly fell to $76.48 in New York trading.

On August 3, 2026, Tokyo's Nikkei 225 fell for the first time in three sessions, closing down 607.12 points (-0.94%) at 63,754.90. It emerged that Japan and the US had conducted coordinated yen-buying, dollar-selling intervention on July 31, and the yen surged in Tokyo's foreign exchange market that day, briefly touching the low-155 range per dollar, its strongest level since May 6. Concerns over the yen's continued rise led to selling in export-related stocks such as Fanuc, Toyota Motor, and TOTO, and the recovery in AI and semiconductor stocks seen the previous week also paused. Fanuc fell sharply after its April-June earnings were seen as underwhelming. Bank of Japan Governor Ueda emphasized heightened awareness of upside inflation risks at his press conference on the 31st, and markets have begun to price in the possibility of a further rate hike at the October meeting. The euro also rose against the yen, briefly reaching the mid-179 range, its strongest level since November 2025.