{"id":14887,"date":"2024-09-04T05:48:19","date_gmt":"2024-09-04T05:48:19","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=14887"},"modified":"2024-09-04T05:48:19","modified_gmt":"2024-09-04T05:48:19","slug":"japans-nikkei-drops-to-three-week-low-following-wall-street-sell-off","status":"publish","type":"post","link":"https:\/\/www.global-vtrader.com\/en\/analysis\/japans-nikkei-drops-to-three-week-low-following-wall-street-sell-off\/","title":{"rendered":"Japan&#8217;s Nikkei drops to three-week low following Wall Street sell-off"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><strong>Key points:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Nikkei dropped 3.3%, falling to 37,393.48, with chipmakers leading declines.<\/li>\n\n\n\n<li>Tokyo Electron fell 6.54%, while Advantest and Renesas lost 7% and 8.5%, respectively.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p class=\"wp-block-paragraph\">On Wednesday, Japan\u2019s Nikkei 225 index dropped to its lowest point since mid-August, reflecting global market anxiety. The index fell by 3.3% to 37,393.48 by 0134 GMT, after initially dipping 4% earlier in the session. <\/p>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/wp-content\/uploads\/2024\/09\/20240904-134103-1024x465.jpg\" alt=\"\nThe technical indicators for the Nikkei 225 on vtmarkets.com are pointing to a bearish outlook. The MACD histogram has been extending further into negative territory, signaling that momentum is clearly favoring the bears. Additionally, the moving averages are trending downward, with the shorter-term MA crossing below the longer-term MA, suggesting that selling pressure may persist in the near term.\" class=\"wp-image-14888\" style=\"width:1450px;height:auto\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center wp-block-paragraph\"><em>See: Nikkei225 plunges as seen on the <a href=\"https:\/\/vtmarketsapp.onelink.me\/CD7D\/240525WA\">VT Markets app<\/a>.<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This decline comes amidst broader market weakness, which also saw the Topix index fall by 2.76% to 2,657.81. The sell-off has placed almost all sectors under pressure, reflecting widespread concerns in the market.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Looking at the charts, we see that the technical indicators are also painting a bearish picture. The MACD histogram has been deepening in negative territory, suggesting momentum is clearly in favor of the bears. The moving averages are sloping downward, with the shorter-term MA crossing below the longer-term one, indicating the potential for continued selling pressure.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Market participants are likely reacting to broader macroeconomic concerns, including potential global slowdowns and monetary policy uncertainties. For now, our analysts believe that the downward trajectory in the Nikkei may persist unless there is a major shift in either the domestic or global economic outlook. <\/p>\n\n\n\n<h1 class=\"wp-block-heading has-medium-font-size\"><strong>Wall Street sell-off triggers market pullback ahead of key U.S. payroll data<\/strong><\/h1>\n\n\n\n<p class=\"wp-block-paragraph\">This market pullback followed Wall Street&#8217;s biggest drop since early August, where major U.S. indices like the S&amp;P 500, Nasdaq Composite, and Dow Jones Industrial Average all recorded substantial losses. The sell-off came as investors positioned themselves cautiously ahead of U.S. non-farm payrolls data, which will play a pivotal role in shaping expectations for future Federal Reserve interest rate moves.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Chip-related stocks in Japan were among the hardest hit, mirroring weakness in the U.S. tech sector. Tokyo Electron fell by 6.54%, <a href=\"https:\/\/x.com\/Investopedia\/status\/1831021895895933020\">closely following Nvidia\u2019s 10% drop on Tuesday<\/a>. <\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">September got off to a rough start for chip stocks on Tuesday, with Nvidia leading the slump as markets continued to digest last week\u2019s earnings report from the semiconductor giant. <a href=\"https:\/\/t.co\/JSKt0HUfAx\">https:\/\/t.co\/JSKt0HUfAx<\/a><\/p>&mdash; Investopedia (@Investopedia) <a href=\"https:\/\/twitter.com\/Investopedia\/status\/1831021895895933020?ref_src=twsrc%5Etfw\">September 3, 2024<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Peer company Advantest shed 7%, and Renesas Electronics was down 8.5%, becoming the biggest loser within the Nikkei. The slump in chip-related stocks reflects broader concerns about potential slowdowns in global technology demand, especially as high interest rates and economic uncertainty dampen growth prospects in key markets like the U.S.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>You might be interested : <a href=\"https:\/\/www.vtmarkets.com\/analysis\/japans-nikkei-falls-after-wall-streets-tech-stocks-drop\/\">Japan\u2019s Nikkei falls after Wall Street\u2019s tech stocks drop<\/a><\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\"><strong>Energy sector leads losses as Tokyo Stock Exchange sees broad sell-off<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Energy stocks also experienced sharp declines, with the energy exploration sub-index falling 5.5%, making it the worst-performing sector on the Tokyo Stock Exchange. All 33 industry sub-indexes recorded losses, further underlining the broad-based nature of the sell-off.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Despite the negative sentiment, a few companies managed to buck the trend. Shares of Nitori Holdings, which imports materials for furniture and home interior goods, rose by 2.75%, supported by the strengthening yen. This contrasts with much of the broader market, where a stronger yen typically weighs on export-dependent companies.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\"><strong>Nikkei sees widespread declines as investors brace for U.S. economic slowdown<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Of the 225 companies that make up the Nikkei, 212 stocks fell, while only 12 traded higher. One stock remained flat. The overwhelming number of declines highlights the cautious sentiment pervading markets, with investors on edge about potential U.S. economic slowdowns and the impact on global growth.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The broader market will likely remain sensitive to key economic data due later this week, including the much-anticipated U.S. non-farm payrolls report. The outcome of this report could influence Federal Reserve policy and determine the course of interest rates, which have played a central role in shaping market volatility in recent weeks. Investors will also be watching U.S. jobless claims data and job openings figures for further signs of economic health in the world&#8217;s largest economy.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Also read: <a href=\"https:\/\/www.vtmarkets.com\/analysis\/sp-500-wraps-up-august-gains-as-rate-cut-decision-looms\/\">S&amp;P 500 wraps up August gains as rate cut decision looms\u00a0<\/a><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As uncertainty continues to grip markets, it\u2019s possible that risk-averse trading will persist, particularly in sectors exposed to global demand cycles such as technology and energy. Meanwhile, defensive sectors and companies with positive internal developments, like Fuji Soft and Nitori Holdings, may continue to offer isolated pockets of resilience.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Start trading now \u2014 click <\/strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/?utm_campaign=account_c&amp;utm_source=dma&amp;utm_medium=website\"><strong>here<\/strong><\/a><strong> to create your live VT Markets account.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>On Wednesday, Japan\u2019s Nikkei 225 index dropped to its lowest point since mid-August, reflecting global market anxiety. The index fell by 3.3% to 37,393.48 by 0134 GMT, after initially dipping 4% earlier in the session.  -vtmarkets.com<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[27],"tags":[],"class_list":["post-14887","post","type-post","status-publish","format-standard","hentry","category-analysis"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/14887","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/comments?post=14887"}],"version-history":[{"count":0,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/14887\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/media?parent=14887"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/categories?post=14887"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/tags?post=14887"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}