Nikkei falls sharply amid U.S. economic concerns, Japan Bank raises interest rates

(MENAFN) The Nikkei stock average in Japan faced a severe decline of 8.1 percent on Monday, a drop of more than 2,900 points, bringing it to 32,991.88 by midday in Tokyo. This dramatic plunge is attributed to heightened concerns that the U.S. economy may be in a more precarious state than previously thought. The fall follows a 5.8 percent drop on Friday, resulting in the worst two-day decline ever recorded for the index. The recent slide has evoked comparisons to past market crashes, including the infamous "Black Monday" in October 1987, when the market experienced a 14.9 percent drop.

The significant downturn in Tokyo's stock market has been further aggravated by the Bank of Japan's decision to raise its benchmark interest rate on Wednesday. This increase, which brings the benchmark price back to the level it was a year ago, has contributed to growing investor anxiety. The market's negative reaction to the rate hike underscores the broader unease surrounding economic stability and future market conditions.

The combined effect of the U.S. economic uncertainties and the recent rate hike by the Bank of Japan has led to a pronounced drop in the Nikkei index. This sharp decline reflects mounting investor fears and highlights the volatility within the global financial markets. As the situation evolves, market participants will be closely watching for any further developments that could impact economic stability and market performance.

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