Japan’s Nikkei 225 stock index suffered a dramatic drop of up to 10 per cent on Monday, as investor panic intensified amid fears of a deteriorating US economy.
By midafternoon in Tokyo, the Nikkei index had fallen over 3,500 points, reaching 32,385.01. This decline follows a 5.8 per cent drop on Friday, marking what could become its worst two-day decline in history.
The last comparable drop occurred on “Black Monday” in October 1987, when the Nikkei fell 3,836 points, or 14.9 per cent. The recent downturn is exacerbated by the Bank of Japan’s recent decision to increase its benchmark interest rate, which now stands at levels similar to those from a year ago.
The decline in Tokyo shares follows a broader trend across Asian markets, which have fallen to multi-year lows as investors shift from risky assets to safe-haven bonds. This shift is fueled by concerns that the Federal Reserve’s extended efforts to combat inflation may have pushed the US economy towards recession.
In Bharat, the Sensex and Nifty indices both tumbled by 3 per cent, reflecting the widespread impact of the market turmoil. Despite significant losses in the domestic markets, the situation remains less severe compared to other Asian stock markets.
