Tokyo Stocks Slide as Global Economic Worries and Tariff Fears Rattle Investors

Kathmandu — Japan’s stock market fell on Tuesday amid growing concerns over the global economic outlook, as investors turned cautious following fresh tariff-related tensions involving the United States.

The benchmark Nikkei 225, which tracks 225 major Japanese companies, dropped 592.47 points, or 1.11 percent, to close at 52,991.10 compared to Monday’s session. The broader TOPIX also declined, shedding 30.80 points, or 0.84 percent, to end the day at 3,625.60.

Market sentiment weakened after reports that the United States could impose new tariffs linked to the Greenland issue, raising fears of escalating trade frictions. Analysts said investors grew wary that renewed tariff threats could strain transatlantic relations and further disrupt global trade flows.

Bond Yields Hit Decades-High

At the same time, yields on Japan’s 10-year benchmark government bonds briefly climbed to 2.350 percent, their highest level since February 1999. Analysts attributed the surge to expectations that Prime Minister Sanae Takaichi’s government may increase public spending and issue additional debt, prompting heavier bond selling and pushing yields higher.

Tech and Growth Stocks Under Pressure

Selling pressure was particularly strong in semiconductor, artificial intelligence (AI), and electronics-related stocks, sectors considered highly sensitive to economic cycles. Market participants noted that these industries are vulnerable to global demand fluctuations and trade policy uncertainty.

Concerns were further amplified after US President Donald Trump announced new tariffs on goods from eight European countries in connection with the Greenland issue. Analysts warned that a deterioration in US–Europe relations could have spillover effects on Asian markets, including Japan.

Interpretation: Caution Dominates Market Mood

Overall, the decline in Tokyo stocks reflects a combination of geopolitical uncertainty, trade-related risks, and rising concerns over government debt. While Japan’s economic fundamentals remain relatively stable, analysts say short-term market movements are likely to remain volatile as investors closely monitor global political developments and policy signals from major economies.