Japan's Nikkei slides as Middle East stalemate fuels oil, inflation concerns

Business Recorder reported that Japan's Nikkei slipped 1.1% to 68,460.56 by late morning on Tuesday, threatening to end a run of five consecutive sessions in the green. The index had climbed 5.5% over that stretch. The broader Topix was 0.2% lower at 4,177.50 as an unresolved Middle East standoff lifted crude prices and revived worries about inflation and bond market risks.

A truce between Washington and Tehran lapsed this week after the United States declined to extend the ceasefire, and Iran signalled a fully offensive military stance. Shipping through the Strait of Hormuz halted again, pushing crude higher, while bond yields rose in several markets including Japan.

Nomura Securities strategist Wataru Akiyama argued that higher interest rates expose overpriced shares, and persistent inflation in Japan and the United States could weigh on stocks. Meanwhile, marine transport gained 4.1% on expectations of higher freight rates and ranked first among 33 Tokyo Stock Exchange industry groups. SoftBank Group rose 2.7% while Tokyo Electron fell 4.3%.