Japan’s Nikkei Stock Average Slides on Stronger Yen Amid Intervention Threat

Reuters

17:06 JST, January 26, 2026

TOKYO, Jan 26 (Reuters) – Japan’s Nikkei share average slumped on Monday as a stronger yen broadly weighed on the market, with currency intervention worries further deterring equity buyers.

The yen traded as strong as 153.815 per dollar, a more than three-month peak, after what looked like a precursor to intervention sent Japan’s currency spiking on Friday and catalyzed further advances over the rest of the day.

A source told Reuters that the New York Federal Reserve conducted so-called “rate checks” on the dollar-yen pair that day, potentially signaling both that intervention was close and that it could be a joint action between U.S. and Japanese authorities.

A stronger yen reduces the value of offshore revenue for Japan’s many heavyweight exporters.

The Nikkei closed down 1.8% at 52,885.25, with 193 of its 225 components under water, while 31 rose and one ended flat.

The broader Topix dropped 2.1% to 3,552.49.

“The risk of intervention remains, and the outlook is unclear,” said Maki Sawada, a strategist at Nomura Securities.

“For both currencies and stocks, it’s hard for traders to take positions in this environment.”

An index of automotive shares tumbled 3.6%, the most among the Tokyo Stock Exchange’s 33 industry groups.

Toyota Motor slid 4.1% and Honda slumped 4.4%.

The biggest weight on the Nikkei was AI-focused startup investor SoftBank Group, which plunged 4.9%, shaving 164 points from the index.

At the opposite end, furniture retailer Nitori, which benefits from a stronger yen because it imports much of what it sells, jumped 4.8%.