Tokyo Stock Market Plunges to Six-Month Low
The Tokyo stock market experienced a dramatic downturn on August 2nd, with the Nikkei 225 index plummeting to a six-month low. The index closed at 35,909.70, a significant drop of 2,216.63 points or 5.81% from the previous day's close. This marked the first time in six months that the index had fallen below the 36,000 level.
The steep decline was the second largest in history in terms of points, trailing only the "Black Monday" stock market crash of October 1987. This significant drop was fueled by several factors, including concerns about an economic slowdown and profit-taking following recent gains.
Adding to the market's woes, the yen continued to strengthen against the dollar, reaching 148 yen per dollar in the morning. This rapid appreciation of the yen put pressure on export-related stocks, further contributing to the market's decline.
The Tokyo market's downturn followed a similar trend in the US, where the Dow Jones Industrial Average fell by 494.82 points or 1.21% on August 1st. This marked the first decline for the Dow in three days and was attributed to concerns about an economic slowdown and profit-taking.
The simultaneous decline in both the US and Japanese markets highlights growing concerns about the global economic outlook. Investors are increasingly worried about the potential for a recession, fueled by factors such as rising inflation, interest rate hikes, and the ongoing war in Ukraine. These concerns are likely to continue to weigh on markets in the coming weeks and months.