Japan's Nikkei 225 index fell 0.44% to close at 60,550.59, marking the fourth consecutive session of losses as technology heavyweights dragged the market lower. According to Business Standard, the index gave up initial gains of more than 1% during the session, reflecting continued pressure from technology sector weakness. The sustained decline comes amid oil prices keeping investors on edge, with higher oil prices driving fears about inflation and potential central bank rate hikes that could hurt economic growth and drag on stock prices.
Technology stocks led the decline for the fourth consecutive session, with chip-making equipment maker Tokyo Electron losing 4.26% to drag the Nikkei lower the most. As reported by The Economic Times, chip-testing equipment maker Advantest fell 3.29% and technology investor SoftBank Group slipped 4.15%, while memory maker Kioxia declined 3.27%. Fibre optic cable makers Fujikura and Furukawa Electric fell 16.95% and 8.37% respectively, becoming the worst percentage losers on the Nikkei. The decline mirrored overnight weakness in U.S. technology markets, where the Nasdaq and benchmark S&P 500 closed lower as investors took profits. Nvidia, the world's most valuable company, was the S&P 500's biggest index-point drag on Monday, falling 1.3%.
On the economic front, Japan's gross domestic product expanded a seasonally adjusted 0.5% on quarter in the first quarter of 2026, according to the Cabinet Office's preliminary reading. This was up from the downwardly revised 0.2% increase in the three months prior (originally 0.3%). On a yearly basis, GDP was up 2.1%. However, Japan's industrial production index was at 102.0 in March, marking a 2.4% increase from the previous year but a 0.4% decrease from February, according to the Ministry of Economy, Trade and Industry (METI). The mixed economic data provided limited support to the technology-heavy market, with investors focusing on the continued weakness in the sector.
Bank shares rose significantly, with Mitsubishi UFJ Financial Group climbing 3.77% and Mizuho Financial Group rising 5.53%. As reported by The Economic Times, of more than 1,600 stocks on the Tokyo Stock Exchange's prime market, 71% rose, 27% fell and 1% traded flat. The banking sector's strong performance contributed to the overall market resilience despite technology sector weakness, with investors showing preference for traditional financial stocks amid the mixed market conditions.
Investors are closely watching for Nvidia's earnings report scheduled for Wednesday, with the chipmaker being the S&P 500's biggest index-point drag on Monday, falling 1.3%. According to The Economic Times, market strategists are trying to determine "how much longer the declines of U.S. technology stocks will continue" and are seeking clarity on the earnings outcome. The focus on Nvidia reflects the market's sensitivity to developments in the technology sector, with investors closely monitoring the world's most valuable company's performance for signals about the broader technology market direction.
