Nikkei 225 Ends Flat After 1,500-Point Intraday Swing as Cyclicals Outpace Tech
Published on 07/07/2026 at 03:05 | Redaktion boerse-global.de
The Nikkei 225 closed virtually unchanged on Monday after a dramatic intraday swing of nearly 1,500 points, as a late-session rotation into automakers and banks offset persistent weakness in semiconductor shares. The index finished at 69,737.69, down just 0.01%, after touching a high of 70,384.59 and a low of 68,904.41.
The wild ride began with a sharp morning selloff, triggered by a delayed reaction to disappointing US jobs data released on Friday. With American markets closed for Independence Day, Tokyo traders had to absorb the news on Monday, sending the Nikkei down more than 800 points in the morning session. The yen initially strengthened on the weak payrolls report, pressuring export stocks, but the dollar later recovered, providing a tailwind for Japan’s export-heavy sectors.
Beneath the flat headline, a clear sector rotation unfolded. Institutional investors trimmed exposure to high-flying technology names and poured capital into cyclical value plays. Mazda jumped 2.24% on strong exports and a favorable currency backdrop, while Nissan added 1.92% on improving North American sales. Financials also thrived: Sumitomo Mitsui Financial rose 1.92% and Mizuho Financial gained 1.32%, buoyed by a surge in Japanese government bond yields to 2.81% — the highest in 29 years — which boosts banks’ interest margins. Honda climbed 1.51% after large block trades in the morning.
Should investors sell immediately? Or is it worth buying Nikkei 225?
On the losing side, SoftBank Group slid 0.42% amid growing concerns about overinvestment in AI infrastructure, while Tokyo Electron and Advantest faced selling pressure as investors positioned ahead of Samsung Electronics’ preliminary second-quarter results due Tuesday. The chip sector weighed on the index all afternoon, preventing it from holding above 70,000. Despite the index’s marginal decline, over 70% of stocks on the Prime Market actually advanced — a sign that the weakness was concentrated in a handful of heavyweights.
The 70,000 level remains a stubborn barrier. The index briefly breached it during the afternoon recovery but failed to close above it for the third consecutive session. Chart watchers note strong resistance in the 70,000–72,000 zone, while support held firm at 68,900. The 14-day relative strength index stands at 55.5, neutral after being overbought in June. The Nikkei now sits 4.25% below its all-time high of 72,831.73 set on June 22.
The weak yen continues to underpin the market, with the dollar trading at 161.54. That tailwind, combined with the JGB yield spike, has fueled the shift from growth to value. Option positioning for the July settlement shows heavy open interest at the 70,000 strike, underscoring its importance. Meanwhile, Nikkei 225 futures traded in Chicago closed at 70,255, pointing to a higher open on Tuesday. Trading volume on Monday was elevated at roughly 10.4 trillion yen, reflecting active portfolio rebalancing by global funds. Year to date, the Nikkei leads global indices with a gain of 38.55%, more than triple the S&P 500’s roughly 10% advance, and has surged 76.16% over the past 12 months.
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