Asian stock markets showed mixed performance on October 22, with Tokyo’s Nikkei index dropping 1.42% amid uncertainty ahead of Japan’s general elections and concerns over the U.S. presidential race. The yen weakened to its lowest point in three months, impacting investor sentiment. Meanwhile, China’s markets remained focused on economic concerns, with minor gains noted. Oil prices stabilized after recent increases driven by geopolitical tensions, while gold retreated after reaching an all-time high.
Asian stock markets showed mixed results on Tuesday, October 22, with the Tokyo exchange displaying caution as Japan approaches its general elections. The weakening yen did not provide the expected boost, leaving Asian markets primarily focused on the US presidential election and the state of the Chinese economy. In Tokyo, the Nikkei index fell 1.42% to 38,402.81 points around 02:50 GMT. The broader Topix index also declined by 1.14% to 2,649.36 points, following a volatile day on Wall Street, where traders paused after a week of record highs, gearing up for upcoming corporate earnings reports.
Market participants are closely watching the election campaign, which culminates in Sunday’s parliamentary elections. Prime Minister Shigeru Ishiba’s coalition is losing popularity, risking their majority position. Despite this, analysts believe the Tokyo Stock Exchange could rebound, especially with the yen hitting its lowest point in three months. As noted by SPI Asset Management analyst Stephen Innes, a weaker yen often makes stocks more attractive to investors.
Concerns Over Potential US Tariffs
As of 02:50 GMT, the yen traded at 150.76 against the dollar, down from 150.83 the previous day—marking the first decline since August 1. The currency’s weakness stems from a stronger dollar, influenced by geopolitical tensions and the US Federal Reserve’s cautious approach to interest rates, which makes the dollar yield more attractive compared to Japan’s ultra-low rates.
According to Innes, the upcoming weeks may pose challenges for Asian markets, particularly as fears of increased US tariffs loom should Donald Trump win the presidency. A Trump victory could lead to rising US yields, further driving demand for the dollar in foreign exchange markets.
Chinese Markets and Oil Prices
Chinese stock markets are primarily concerned with the nation’s economic performance, which could be adversely impacted by tougher US trade restrictions. Central bank efforts to cut rates and stimulate activity appeared ineffective on Monday. As of 02:50 GMT, the Shanghai Composite Index slightly increased by 0.04% to 3,269.37 points, while the Shenzhen Composite Index rose by 0.34% to 1,943.56 points. In Hong Kong, the Hang Seng index saw a modest gain of 0.02%, reaching 20,482.67 points.
On the oil front, prices stabilized after last week’s spike due to fears of potential Israeli actions against Iran. At around 02:50 GMT, Brent North Sea crude fell by 0.34% to $74.04 per barrel, while U.S. West Texas Intermediate (WTI) dropped 0.41% to $70.27.
Meanwhile, gold, often viewed as a safe haven during geopolitical uncertainties, experienced a slight pullback after hitting a record high of approximately $2,730 an ounce the previous day.