Nikkei Average Falls 200 Yen to 66,016, Weighed by Walmart Slump and Higher Oil Prices

Nikkei Average Falls 200 Yen to 66,016, Weighed by Walmart Slump and Higher Oil Prices In addition to higher oil prices driven by a rebound in U.S. long-term interest rates and Middle East tensions, Walmart's weak earnings weighed on consumer stocks. The decline temporarily exceeded 900 yen, and the Nikkei average VI jumped to 34.68. High-priced stocks were sold in particular, while the TOPIX was slightly higher. 12345

July Core CPI Rises 1.8%, Growth Expands for Second Consecutive Month, Supporting BOJ Rate Hike Expectations According to the Ministry of Internal Affairs and Communications' July national consumer price index released on the 21st, the core index excluding fresh food rose 1.8% year-on-year, in line with market expectations. Energy turned to an increase for the first time in eight months, and food excluding fresh food also rose 3.0%. In the interest rate swap market, the probability of a BOJ rate hike by the September meeting was around 80%, supporting expectations for an early additional hike. 67

July Trade Deficit of 634.5 Billion Yen Expands for Third Consecutive Month on Surging Crude Oil Import Costs According to the Ministry of Finance's July trade statistics released on the 20th, the trade balance was a deficit of 634.5 billion yen. Due to the situation in the Strait of Hormuz, crude oil imports rose 87.8% year-on-year to 1.4089 trillion yen, widening the deficit from 395.1 billion yen in May. Exports reached a record high of 11.5118 trillion yen, but automobile exports to the Middle East fell 31.6% in volume terms. 8

Government Registers SmartRound, Intermediary for Unlisted Stock Trading, to Promote Unicorn Creation The government has registered SmartRound, which mediates trading of shares in emerging unlisted companies. The aim is to support the creation of unicorns by improving startups' fundraising and stock liquidity. 9