FX.co ★ Japanese Stocks Slip Amid Election Uncertainty

On Wednesday, the Nikkei 225 slightly decreased by 0.04%, closing at 39,663, while the broader Topix index saw a decline of 0.21%, settling at 2,819. This downward trend is attributed to growing investor caution in anticipation of Japan’s forthcoming Upper House election. Market participants remain wary of potential significant fiscal policy changes, particularly speculations regarding a possible reduction or abolition of the sales tax. Concerns about increased borrowing costs have consequently led to a rise in Japanese government bond yields. Adding to the market unease, investors are closely following the developments in trade tensions after U.S. President Donald Trump indicated potential tariffs on pharmaceuticals and semiconductors could be imposed by August 1st. Leading the market losses were major stocks, with Lasertec plummeting 5%, Sanrio decreasing by 2.9%, Mitsubishi UFJ dropping 1.4%, and both Fast Retailing and Toyota Motor declining by 0.9%.