Nikkei Average Plunges 2,565 Yen, Closes Below 70,000 as AI Rally Pauses and Profit-Taking Ensues

Nikkei Average Falls 2,565 Yen, Closes Below 70,000 as AI Rally Pauses On the Tokyo stock market on the 23rd, the Nikkei average plunged 2,565 yen from the previous day to 69,788 yen, falling for the first time in nine trading sessions. In reaction to an eight-day winning streak that had brought it to the 72,000 yen level for the first time, a rush of profit-taking hit AI and semiconductor-related stocks. SoftBank Group and Tokyo Electron were among those that declined. Overheating had been a concern in the market. 123

Yen Nears 39-Year Low, Japan and US Finance Ministers Discuss, Intervention Feared In New York foreign exchange markets, the yen briefly fell to 161.92 yen to the dollar, approaching its lowest level in about 39 and a half years since 1986. The backdrop was US rate hike expectations and a widening Japan-US interest rate differential. Finance Minister Katayama held online talks with US Treasury Secretary Bessent, indicating a readiness to intervene in currency markets, stating 'we will respond appropriately whenever necessary.' The 162 yen level has become a psychological threshold, and the market is on heightened alert. 4567

Prime Minister Takaichi Announces Plan to Restore Consumption Tax on Food to 8% in Two Years, Local Revenue Shortfall of 1.6 Trillion Yen Prime Minister Takaichi announced on the 22nd a plan to revert the consumption tax on food from the current reduced rate (8%) back to the original 8% in two years. This is expected to result in a revenue shortfall of approximately 1.6 trillion yen for local governments. While the tax rate reduction will help ease household burdens, concerns about the impact on local finances remain, and future adjustments will be closely watched. 8