Japanese shares set for biggest weekly drop in 11 months on Middle East conflict

TOKYO: Japanese shares marked their steepest weekly drop in almost a year on Friday, as the Middle East war heavily disrupted traffic through the Strait of Hormuz, choking oil supply and pushing investors out of risk and into cash.

The Nikkei 225 Index edged higher 0.6 percent to close at 55,620.84, after falling as much as 1.4 percent earlier in the session. The benchmark wrapped up the week 5.5 percent lower, its worst weekly decline by percentage since the week ended April 4, 2025, when US President Donald Trump announced his sweeping tariffs. The broader Topix climbed 0.4 percent to 3,716.93, but finished the week down 5.6 percent.

“The (markets’) biggest concern is the rise in crude oil prices,” said Shota Sando, an equity market analyst at Tokai Tokyo Intelligence Laboratory.

“If it becomes clear that oil prices aren’t likely to head toward the oft-cited USD100 a barrel level, that would probably bring a sense of relief and help stabilize sentiment.”