According to some analysts and market observers, the Japanese market swung into a state of panic after the Bank of Japan announced its decision to raise interest rates.
The negative sentiment in the Japanese stock market has rippled off to other asset classes including cryptocurrencies. Bitcoin (BTC), Ethereum (ETH), and XRP have all come under selling pressure due to the current situation of the broader market.
Key Metrics in the Japanese Market Face Downtrend
On August 2, the Japanese market faced big losses for the second trading day this month. This selloff was triggered by the rapid strengthening of the yen by the Bank of Japan (BoJ) and the sell-off in stocks in the United States.
For more than a year, Japanese stocks have recorded a series of rallies driven by the depreciation of the local currency and strong corporate earnings. The return of modest inflation and improvements in corporate governance also contributed.
Similarly, a surge in chip-related stocks helped the ascent of the market. However, the Japanese stock market’s performance took a new turn towards the end of this week.
Companies representing the broad swath of the Japanese economy which are largely grouped under the Japan Topix Index saw intense selloffs. As such, this metric tumbled by 6.1% on Friday, further extending the losses of the previous day. Unfortunately, it became the index’s worst two-day performance recorded since the 2011 earthquake and tsunami.
Additionally, the Nikkei 225 (INDEXNIKKEI: NI225) equally tanked by 5.8% to 35,909.70.
According to some analysts and market observers, the Japanese market swung into a state of panic after the Bank of Japan announced its decision to raise interest rates. This is actually the second time after the first in 2007. With brewing concerns about the health status of the Japanese economy and the tech industry in the US, the sentiment in the market became worse.
Cryptocurrency Industry Face Price Dip
The cryptocurrency ecosystem is not left out of the recent price fall with the prices of most digital assets declining gradually. The leading cryptocurrency Bitcoin is currently trading at $64,263.73, down by 0.79% within the last 24 hours. BTC trading volume is still on the upside but barely enough to fuel investors confidence in the market.
At press time, trading volume for BTC stood at $40.08 billion giving it a rank of the second most traded position. Bitcoin’s position is perceived as a reaction to FOMC data which was released on Wednesday.
Ethereum is also down by 1.96% and trading at $3,135.14. Its trading volume is down by 3% and currently at $18.5 billion. Compared to the other two top digital assets, Ripple-associated XRP has lost more of its previous gains.
XRP is currently trading at $0.5705, corresponding to a 6.75% drop in the last 24 hours. This selloff is understandable considering many allies of Ripple Labs including SBI Holdings are based in Japan and impacted by the current market crisis. Meanwhile, XRP price dip comes right after Ripple conducted a series of significant transactions, moving 1 billion XRP and unlocking 500 million tokens from escrow.
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