FX.co ★ Japanese Stocks Slide Amid Escalating Middle East Tensions

On Friday, the Nikkei 225 index dipped by 1.4%, falling below the 37,700 mark, while the more comprehensive Topix Index decreased by 1.1% to 2,752. This marked the second day in a row of declining Japanese stocks, triggered by a significant escalation in tensions in the Middle East. The market downturn followed a preemptive strike by Israel on Iran, aiming at its nuclear program, with Prime Minister Benjamin Netanyahu confirming the assault. He also noted that Iran retains the ability to counterattack, heightening concerns about potential regional instability. These geopolitical tensions were further aggravated by persistent investor anxiety over U.S. trade policies. President Donald Trump reiterated threats of imposing unilateral tariffs to coerce trading partners into renegotiating agreements. Leading stocks bore the brunt of the slide, with Tokyo Electron plunging by 5.3%, Disco Corp slipping by 3.5%, Fast Retailing dropping by 2.1%, Toyota Motor declining by 2.6%, and Recruit Holdings falling by 3.6%. Both major indices were poised to conclude the week on a negative note.