No End Declared in 'Trump Speech'; Japanese Markets Roiled as Nikkei Plunges

Nikkei 225 Ends Morning Session Down 1,000 Points
NHK Points Out "Dissatisfaction Even Among Republican Supporters"

Japanese stock markets shifted into a downward trend after U.S. President Donald Trump’s national address on the 1st (local time) dashed hopes for an end to the war. Concerns over surging oil prices are also mounting. Japanese media criticized President Trump's speech as a political statement aimed at influencing domestic public opinion.

On the morning of the 2nd, the Nikkei 225 average (Nikkei Index) opened at the 54,200 level, rising more than 500 points from the previous day, buoyed by optimism about the end of the war.

On the 1st (local time), U.S. President Donald Trump is delivering a speech on the Iran war at the Cross Hall of the White House in Washington, USA. AP=Yonhap News.

However, around 10 a.m., as President Trump’s speech began, the market mood reversed sharply. With the possibility of a prolonged standoff in the Middle East increasing, Japanese stocks turned downward. A wave of sell orders pushed the index down to 53,300, more than 400 points below the previous day's close.

The decline deepened further, and by the end of the morning session, the Nikkei Index had dropped 1,007.74 points (1.88%) from the previous day to 52,731. Kohei Okazaki, Chief Economist at Nomura Securities, told the Nihon Keizai Shimbun (Nikkei) that "from the market's perspective, the optimism that the situation would be resolved has collapsed."

The yen-to-dollar exchange rate showed a similar pattern. Before the morning speech, the yen traded between 158.72 and 158.75 per U.S. dollar. After 10 a.m., selling of yen and buying of dollars accelerated, sending the exchange rate into the 159 yen range.

Unease over oil prices continues to grow. All Nippon Airways (ANA) and Japan Airlines (JAL) will raise international fuel surcharges by 1.5 to 2 times for tickets issued from June to July. To curb a sharp rise in retail gasoline prices, the Japanese government will increase gasoline subsidies to a record high of 49.8 yen per liter for one week starting today. The Japan Petroleum Information Center predicted that if these subsidies were eliminated, the average gasoline price would reach 219.8 yen per liter.

Meanwhile, the Japanese government maintained a cautious stance on President Trump’s speech. Chief Cabinet Secretary Minoru Kihara refrained from commenting at a press conference following the speech, saying, "I will refrain from commenting on each aspect of the address." He stated, "For Japan, resolving issues through dialogue between the United States and Iran is important. We hope consultations with Iran will move in a positive direction." He added, "We will continue diplomatic efforts tenaciously in close cooperation with the international community to bring about a rapid de-escalation of the situation."

While the government expressed only a general stance, Japanese media offered critical interpretations of President Trump’s address. NHK analyzed, "Expressions such as 'an unprecedented great victory' and 'Iran has collapsed,' which President Trump emphasized, were strongly intended for domestic public opinion,” and pointed out, "Support for the current U.S. attack on Iran is not spreading in the United States. Even some Republican supporters are voicing dissatisfaction."

Experts advised that Japan should take a more active role in resolving the situation rather than maintaining a lukewarm attitude. Jitsuro Terashima, Chairman of the Japan Research Institute, said in an interview with the Mainichi Shimbun, "Japan and Iran have long maintained a friendly relationship. However, after the U.S. attack on Iran, Japan has remained silent and has merely stated that it will reserve judgment. This appears excessively deferential to Trump." Chairman Terashima emphasized, "Japan should make clear its stance on promoting global denuclearization, including in the Middle East. One approach could involve pushing for the adoption of a United Nations resolution."

This content was produced with the assistance of AI translation services.