It's hard to say what is behind the decline in stocks,
Markets are in absolute turmoil this morning thanks to the Nikkei 225’s biggest one-day drop since 1987, which has wiped out the index’s gains for the year.”
Investor sentiment was down as the U.S. employment data for July came in lower than expected, raising fears that the U.S. economy is slowing more than expected,
The market was also weighed down by the yen's appreciation against the dollar and as expectations for exporters' upbeat financial results receded,
Specifically, the scenario of higher unemployment constraining spending and further restraining hiring and incomes and economic activity leading to a recession is the feared scenario here,
To put it mildly, the spike in volatility-of-volatility is a spectacle that underlines just how jittery markets have become,
I think the dollar-yen will shift to the 140-145 zone because of the worse-than-expected non-farm payroll and Middle East tensions,
The question now is whether we keep selling stocks or buy them back,
Domestic equities tanked purely because of the worries that the US economy may be heading to a recession,
I think the market will be unstable till around October, but I would buy them back now because the fundamental factors that lifted the index to its peak have not changed,
The only reason why the Japanese market is up so strongly in the last two years is because the Japanese yen has been very, very weak. Once it reverses, you got to get out right and I think they're all getting out right now as a result of that,
Today's Japanese markets are expected to start the day sharply lower due to the weakness in US equities and the strong yen,