{"id":22640,"date":"2025-05-19T08:44:05","date_gmt":"2025-05-19T08:44:05","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=22640"},"modified":"2025-05-19T08:44:05","modified_gmt":"2025-05-19T08:44:05","slug":"nikkei-drops-as-traders-flee-to-safe-havens","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/en-ca\/analysis\/nikkei-drops-as-traders-flee-to-safe-havens\/","title":{"rendered":"Nikkei Drops as Traders Flee to Safe Havens"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"559\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/indices10-1024x559.png\" alt=\"\" class=\"wp-image-16994\" \/><\/figure>\n\n\n\n<p><strong>Key Points:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Nikkei225 closes 0.68% lower at 37,498.63 after Moody\u2019s cuts U.S. credit rating.<\/li>\n\n\n\n<li>Stronger yen dents exporter sentiment; chip stocks lead losses.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p>Japan\u2019s benchmark Nikkei225 fell sharply on Monday, shedding 0.68% to settle at 37,498.63, as a stronger yen and concerns over the U.S. fiscal outlook pressured sentiment. The <a href=\"https:\/\/t.co\/SWdM8bzFaQ\">broader Topix index<\/a> managed to stay mostly flat, closing just 0.08% lower at 2,738.39.<\/p>\n\n\n\n<p>The selloff was triggered by <a href=\"https:\/\/t.co\/XZRfxV6CY9\">Moody\u2019s decision to downgrade the U.S. sovereign credit rating<\/a> late Friday, citing America\u2019s ballooning $36 trillion national debt. The downgrade rekindled fears of a broader exodus from U.S. assets, leading to safe-haven inflows into the yen, which firmed 0.4% to 145.05 per dollar during Asian trading hours.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">BOJ to keep hiking rates if economy rebounds from tariff hit, deputy governor says <a href=\"https:\/\/t.co\/RjCrhbV7Ul\">https:\/\/t.co\/RjCrhbV7Ul<\/a> <a href=\"https:\/\/t.co\/RjCrhbV7Ul\">https:\/\/t.co\/RjCrhbV7Ul<\/a><\/p>&mdash; Reuters (@Reuters) <a href=\"https:\/\/twitter.com\/Reuters\/status\/1924363192521695343?ref_src=twsrc%5Etfw\">May 19, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>A stronger yen tends to weigh on Japanese exporters, as it reduces the value of overseas earnings once repatriated. Reflecting this concern, chip-related stocks came under pressure, with <strong>Advantest (6857)<\/strong> and <strong>Tokyo Electron (8035)<\/strong> falling 2.85% and 1.7%, respectively.<\/p>\n\n\n\n<p>Moody\u2019s move is likely to complicate Trump\u2019s ambitions for <a href=\"https:\/\/t.co\/ehhFIFWKEI\">renewed tax cuts<\/a>, raising concerns about further fiscal instability that could disrupt global capital flows.<\/p>\n\n\n\n<p>Still, the day wasn\u2019t without gainers. <strong>Daiichi Sankyo (4568)<\/strong> surged 7%, leading the Nikkei&#8217;s advance and offering some relief amid the broader sell-off. Roughly 50% of Tokyo-listed stocks closed higher, 45% declined, and 3% ended unchanged\u2014indicating a mixed but cautious mood.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Technical Analysis<\/h2>\n\n\n\n<p>The Nikkei 225 faced a sharp correction after hitting a high of <strong>37,970.93<\/strong>, pulling back steadily over the past sessions to close at <strong>37,388.18<\/strong>. The index has broken below both the 10- and 30-period moving averages on the 15-minute chart, confirming bearish momentum. The recent drop was accompanied by a negative MACD crossover and widening histogram bars, signalling downside continuation pressure.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/image-18-1024x442.jpg\" alt=\"\" class=\"wp-image-22641\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center\"><em>Picture: Nikkei retreats from 37,970 peak, slides toward 37,300 with bearish momentum firmly in control, as seen on the <\/em><em><a href=\"https:\/\/vtmarketsapp.onelink.me\/CD7D\/240525WA\">VT Markets app<\/a><\/em><\/p>\n\n\n\n<p>Despite an earlier rebound attempt around midday on 17 May, bullish momentum was short-lived. Price action has since formed lower highs and lower lows, pointing to a weakening trend. Support now lies around the <strong>37,300<\/strong> level, with further downside risk if this is breached. Resistance is found near the <strong>37,750\u201337,800<\/strong> region. If the MACD continues to flatten, we may see a short-term consolidation, though the bias remains bearish unless bulls reclaim higher ground above the 30-period MA.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Cautious Forecast<\/h2>\n\n\n\n<p>While Japanese equities are still supported by firm corporate earnings and expectations of continued domestic monetary support, external shocks such as U.S. fiscal instability and <a href=\"https:\/\/t.co\/emEEcePsco\">renewed trade friction <\/a>could weigh heavily in the near term. If the yen continues to appreciate, export-driven sectors could face further downside pressure. Traders will closely watch U.S. Treasury developments and Japanese trade data this week for further direction.<\/p>\n\n\n\n<p><strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/\">Create your live VT Markets account<\/a><\/strong><strong> and <\/strong><strong><a href=\"https:\/\/myaccount.vtmarkets.com\/login?_gl=1*1azgbap*_gcl_au*NjE5NTE3MjY4LjE3NDQ2MDA3NDI.*_ga*MTY4OTgwNTU5Mi4xNzM2NzQ2MTgy*_ga_J26NL1ZVX7*czE3NDQ5NDQ0NTYkbzEyMCRnMCR0MTc0NDk0NDQ1NiRqNjAkbDAkaDA.\">start trading<\/a><\/strong><strong> now.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Trader anxiety resurfaces as credit fears weigh on exporters and chipmakers retreat. &#8211; vtmarkets.com<\/p>\n","protected":false},"author":64,"featured_media":16994,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[31],"tags":[11,30],"class_list":["post-22640","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-indices","tag-nikkei"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/22640","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/64"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=22640"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/22640\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16994"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=22640"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=22640"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=22640"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}