Nikkei 225 Climbs 1.1% as Oil Surge Lifts SoftBank, Exporters
The Nikkei 225 advanced 1.10% to close at ¥39,711 on Monday, as geopolitical tensions in the Middle East drove oil prices higher and boosted Japanese technology and financial stocks amid a weakening yen backdrop.
Yen Weakness Supports Export-Heavy Sectors
The USD/JPY pair held near ¥161.88, maintaining the yen’s recent weakness that has provided tailwinds for Japan’s export-oriented companies. This currency dynamic particularly benefited industrial automation leader Fanuc, which surged 3.45% to ¥3,507.6, and Honda Motor, which gained 1.23% to ¥4,412.94. The weaker yen enhances the competitiveness of Japanese manufacturers in overseas markets while boosting the yen-translated value of foreign earnings.
SoftBank Leads Tech Rally Amid Oil Market Volatility
SoftBank Group emerged as the session’s standout performer, jumping 4.06% to ¥3,079.42, as investors appeared to view the technology conglomerate as a beneficiary of heightened market volatility. The surge came as oil prices spiked 4% following new military strikes that threatened shipping through the Strait of Hormuz, creating ripple effects across global markets. Japan’s major financial institutions also participated in the rally, with Mitsubishi UFJ Financial climbing 1.88% to ¥3,420.7 and Mizuho Financial advancing 1.45% to ¥1,655.84, as higher oil prices and geopolitical uncertainty typically boost demand for financial services.
Defensive Stocks Lag as Risk Appetite Returns
While the broader market advanced, some defensive sectors underperformed as investors rotated toward more cyclical plays. Kyocera led decliners with a 0.73% drop to ¥3,640.32, while Sony Group edged lower by 0.38% to ¥3,294.3. Pharmaceutical giant Takeda also retreated 0.30% to ¥2,616.48, reflecting the market’s shift away from traditionally stable sectors during periods of heightened volatility.
BOJ Policy Outlook Remains in Focus
With the next Bank of Japan meeting scheduled for April 28, 2026, market participants continue to monitor policy signals amid ongoing US-China trade tensions. Current expectations favor a hold at the present rate, though investors remain sensitive to any shifts in Governor Ueda’s tone that could signal future policy adjustments. The central bank’s stance will be particularly crucial given the yen’s recent weakness and its impact on import costs for energy-dependent Japan.
Monday’s session demonstrated the Tokyo market’s continued sensitivity to global energy dynamics and currency movements, with the combination of Middle East tensions and yen weakness creating a favorable environment for Japanese exporters and technology stocks. As oil market volatility persists and geopolitical risks remain elevated, investors will be watching for sustained momentum in these sectors while monitoring any potential policy responses from Japanese authorities.
This article is for informational purposes only and does not constitute investment advice. Past performance does not guarantee future results. Please consult with a qualified financial advisor before making investment decisions.