Japan Morning Briefing: What to Watch on September 25, 2026
Tokyo investors face a cautious start to Friday’s session as geopolitical tensions in the Middle East continue to weigh on global risk sentiment. With the USD/JPY holding firm at ¥158.13, exporters remain in focus while broader market uncertainty persists following overnight developments in US-Iran relations.
Wall Street Closes Mixed Amid Geopolitical Concerns
US markets ended Thursday’s session with modest losses, reflecting investor unease over escalating Middle East tensions. The S&P 500 slipped 0.08% to $767.18, while the Nasdaq 100 remained virtually flat at $741.10. The Dow Jones bore the brunt of selling pressure, declining 0.32% to $512.68 as defensive positioning took hold ahead of the weekend.
Reports of Saudi Arabia intercepting Houthi missiles and ongoing US-Iran tensions dominated headlines, with the US Senate rejecting Democratic efforts to curb potential military action. This geopolitical backdrop is likely to influence Tokyo’s opening sentiment, particularly for defense-related stocks and energy names.
Yen Weakness Supports Export Giants
The USD/JPY rate of ¥158.13 continues to provide tailwinds for Japan’s major exporters, with Toyota, Sony, and Nintendo likely beneficiaries of the weaker yen. NISA investors may find opportunities in these blue-chip names, which have historically performed well during periods of yen weakness.
However, rising concerns about rapid rate increases globally—as highlighted by CNBC’s warning that “something always breaks” when rates rise quickly—could temper enthusiasm for risk assets. Investors should monitor any Bank of Japan commentary or intervention signals given the yen’s current levels.
Key Sectors and Stocks to Watch
Defense contractors like Mitsubishi Heavy Industries may see increased interest amid Middle East tensions, while energy importers could face pressure from potential oil price volatility. Technology exporters remain supported by the favorable exchange rate, though semiconductor names may reflect overnight weakness in US tech.
With geopolitical risks elevated and currency dynamics favorable for exporters, today’s session promises selective opportunities for nimble investors.
This briefing is for informational purposes only and does not constitute investment advice. Please consult with a qualified financial advisor before making investment decisions.