Nikkei Plunges 2.40%; Japanese Market Under Pressure!

The Japanese stock market closed sharply lower on Thursday (October 22, 2026), with the Nikkei 225 index tumbling 2.40% to reach its lowest level in a month. This decline was driven by selling pressure in the paper and pulp, transportation, and communications sectors. Negative sentiment spread across the Tokyo Stock Exchange, with 2,092 stocks falling, 1,404 rising, and 228 remaining stagnant.

Selling pressure also hit several blue-chip stocks, particularly those linked to the technology and semiconductor industries. Shares of Resonac Holdings saw the steepest decline, dropping 11.16% to 12,975 yen, followed by Ibiden, which fell 9.49% to 8,598 yen, and Screen Holdings, which weakened 8.83% to 11,770 yen. These declines highlight mounting pressure on technology stocks—a sector that had previously served as a key pillar for the Japanese market.

Despite the index's decline, some companies managed to post significant gains. Shares of Trend Micro surged 8.69% to 7,314 yen, while Shift rose 8.57% to 1,147 yen. BayCurrent also climbed 3.76% to 11,440 yen, reaching its highest level in five years. However, these gains were not enough to stem the broad-based selling pressure across the market.

On the global front, rising oil prices also drew investor attention. Brent crude for December delivery climbed 2.34% to US$111.37 per barrel, while WTI rose 2.22% to US$99.31 per barrel. High energy prices have the potential to increase operational costs for Japanese companies that rely on oil imports. Meanwhile, December gold futures weakened by 1.01% to US$4,107.90 per troy ounce, and the US dollar fell against the Japanese yen, with the USD/JPY pair reaching the 157.06 level.

Looking ahead, the Nikkei’s movement is expected to remain influenced by energy price trends, the strengthening of the yen, and shifts in investor sentiment toward technology stocks. A stronger yen could weigh on the earnings outlook for Japanese exporters when converted into the domestic currency, while persistently high oil prices may increase production cost pressures. If the pressure on technology stocks continues and energy prices remain elevated, the Nikkei risks further declines. Conversely, an improvement in global sentiment could create opportunities for a recovery in the Japanese stock market.