Nikkei Incurs 3rd-Biggest Point Loss amid Oil Worries

Tokyo, March 9 (Jiji Press)–Tokyo stocks plummeted Monday due to a surge in crude oil prices attributed to rising Middle East tensions, leading the key Nikkei 225 average to close with the third-largest daily point loss on record. The Nikkei index finished the day’s session at 52,728.72, down 2,892.12 points, or 5.19 pct, from Friday. Its loss temporarily expanded to over 4,200 points. In off-hours trading Sunday, key U.S. crude oil futures shot up to hit 119 dollars per barrel, up 31 pct from late last week and the highest level since June 2022, after the start of Russia’s full-fledged aggression against Ukraine in late February that year. The price surge came as anxiety about crude oil supplies grew further after the Israeli military over the weekend conducted airstrikes on oil storage facilities in Tehran, apparently marking the first time that any Iranian oil facility has been targeted since the United States and Israel began their military operations against Iran on Feb. 28. A wide range of stocks met with selling on the Tokyo market Monday as investors grew increasingly concerned that the Iran conflict will not end anytime soon, following news that Mojtaba Khamenei, the second son of Ayatollah Ali Khamenei, was selected as the country’s new supreme leader to succeed his father, who was killed in the U.S.-Israeli attacks, market sources said. “Investors believe that a drastic change in Iran’s regime is unlikely, meaning there is a risk that both the conflict and the soaring oil prices will be a long-term problem if Tehran maintains its staunch anti-U.S. policy,” a securities house official said. An official of an online brokerage firm said, “If high crude oil prices are prolonged, that would negatively affect the Asian economy as a whole.” Also behind the plunge in Tokyo stocks was a drop in the U.S. equity market Friday, linked to worries about a U.S. economic slowdown due to disappointing U.S. employment data for February, released the same day, the market sources said. Tokyo currency trading Monday saw a raft of safe-haven dollar buying amid concerns over a possible prolonged Middle East conflict. At 4 p.m., the dollar stood at 158.63-63 yen, up from 157.52-53 yen at 5 p.m. Friday. Meanwhile, the key yield on 10-year Japanese government bonds, the country’s benchmark long-term interest rate, rose to as high as 2.225 pct in Tokyo trading Monday. END [Copyright The Jiji Press, Ltd.]