Nikkei Pullback: A Pause or the Start of a Downtrend?

The Nikkei index fell 0.78% to 54,293.36, giving back some of the sharp gains made the previous day when it surged nearly 4%, marking its largest daily increase since October. The pullback, however, was more of a rotation rather than broad-based selling, as many stocks on the Tokyo Stock Exchange remained positive. Losses were particularly concentrated in software and chip-related stocks, which tracked a global selloff in these sectors. Despite the retreat, underlying market breadth remained solid, with over 60% of stocks advancing. A cautious outlook suggests that after such a steep rally, the index may consolidate near these record levels as traders reassess their positions.

Read more on how global market trends and sector movements are shaping Nikkei performance