Japanese stocks slide as Middle East tensions weigh on sentiment

Japanese equities fell sharply on Monday, with both major indices dropping to their lowest levels in over two months. The Nikkei 225 declined 3.48% to 51,515, while the TOPIX fell 3.41% to 3,486. Markets were pressured by ongoing geopolitical tensions in the Middle East, which have shown little sign of easing. Concerns over potential disruptions to oil supply pushed energy prices higher, increasing worries about inflation and the likelihood that central banks may maintain or even tighten their policy stance. The Bank of Japan recently kept interest rates unchanged but indicated it remains open to further tightening if needed, adding to investor caution. Losses were broad-based, led by declines in technology, financial, and consumer stocks. Several major companies recorded notable drops during the session, contributing to the overall market weakness. Overall, a mix of geopolitical risks, rising costs, and tighter monetary expectations weighed heavily on investor sentiment.

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