Japanese stocks fell sharply at the close of Wednesday's session, with the Nikkei losing around 730 points to close at 39,180.23, on growing expectations of a Bank of Japan interest rate hike and shrinking core machinery orders in the country.
In this regard, Bank of Japan member Seiji Adachi raised market expectations that the central bank may raise interest rates again; by stating that the Bank of Japan will raise its policy rate at a pace that exceeds the inflation rate; if the chances of core inflation exceeding the 2% level increase.
Also, the growth rate of core machinery orders in Japan recorded a contraction of 1.9% in August from a contraction of about 0.1% in July, which contradicted market expectations that the index would grow by 0.1%, reflecting the damage to productivity within Japan, which may negatively affect economic activity.
In general, these developments had a negative impact on the Japanese stock market today, and pushed the two benchmark indices to decline significantly at the end of trading, with anticipation of the release of trade balance and national inflation data this week.
At the end of Asian trading, Japanese stocks declined, as the Nikkei index lost about 730.32 points, or a decrease of 1.83%, to record 39,180.23 points, which is the lowest level for the Nikkei index in 4 sessions.
The Topix index also fell, missing its 5-session high, to 2,690.66 points, down 1.21%.
