- Strong recovery in Japan after falling
After a crash the previous day, the Japanese stock market showed significant recovery on Tuesday. Tech-heavy markets like South Korea and Taiwan also gained notably. Elsewhere in the Asia-Pacific region, however, the picture was mixed.
Japanese stocks benefited from a decline in the yen against the dollar, according to market strategists at Deutsche Bank. This boosted export-oriented stocks such as automakers. The Nikkei 225 index climbed 10.23% to 34,675.46 points, recouping some of the previous day's losses when it fell over 12% to its lowest level since November 2020.
Stock markets in South Korea and Taiwan also recovered strongly. Elsewhere, gains were modest. The Australian S&P/ASX 200 rose just 0.41% to 7,680.60 points, and gains in India were also limited.
Chinese bourses, which had held up relatively well the previous day, slipped back. Hong Kong's Hang Seng index fell 0.46% to 16,621.40 points, while the CSI 300 index of the 300 most important stocks on the Chinese mainland slipped 0.71% to 3,319.72 points.
In addition to increased risk aversion following the crash at the start of the week, tensions between Israel and Iran were also causing caution. "A wildfire is brewing in the Middle East," said Landesbank Baden-Württemberg. "Observers apparently expect a military escalation as early as this week."
This leaves the risk of further losses on international stock markets. "There are now numerous new sell signals in the charts of stock indices," warned technical analyst Marcel Mussler. However, he does not expect a market crash. "What we are experiencing now is likely to be the start of a normal third-quarter correction."
Other regional markets, such as Hong Kong and China, experienced minor setbacks amidst rising geopolitical tensions and increased risk aversion. Despite these challenges, investors remain cautiously optimistic, viewing the current market situation as a potential opportunity for other markets to show Other signs of resilience and recovery.
