WhyItDropped

Nikkei 225 · November 5, 2010

After America decided to print more

+2.86%

single-day change vs previous close

Part of a longer stretch

A rebound that ended at the earthquake

midway through · 2010-08-31 → 2011-02-21, +23.04% over the whole period

What happened that day?

  • The Nikkei 225 rose 2.86% on the day
  • The US Fed announced a second round of bond buying, on the grounds that prices were not rising enough
  • For Japan this cut both ways. Rising world risk assets lift Japanese shares, but America printing weakens the dollar and strengthens the yen
  • A stronger yen worsens exporters' earnings, so Japan receives only half the benefit of American stimulus
  • The yen was in fact at its strongest in fifteen years around this time
  • The rebound ran to February 2011 and was cut off by the March earthquake

Sources

Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.