Tokyo Market Summary: The Nikkei Average dropped sharply, breaking below the 54,000-yen level for the first time in a month. Crude oil ETFs rose amid high WTI prices due to Middle East tensions. Kawasaki Heavy Industries fell further but announced cooperation with a German company in hydrogen and construction machinery. Kubota Pharma plummeted 20% on profit-taking and worsening market sentiment. Nidec rebounded.

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Market Overview

On the 4th, the Nikkei Average sharply declined for the third consecutive day. The closing price fell by 2,033 yen to 54,245 yen. Following declines in European and American stocks, the index dropped over 800 yen from the opening, falling well below the key 56,000-yen level. It quickly widened the losses to four digits, easily breaking below the 55,000-yen mark, and approached 54,000 yen by the morning session close. Broad selling impacted many large-cap leading stocks, significantly deteriorating sentiment. In the afternoon session, the index broke below 54,000 yen, entering the 53,600-yen range. After expanding losses to over 2,600 yen, selling pressure finally subsided, and the market slightly recovered before moving into an extended period of consolidation around the 54,000-yen level.

The trading volume on the TSE Prime Market was approximately 10.57 trillion yen, increasing as volatility widened. All 33 industry sectors declined, with miscellaneous products, retail, and services experiencing relatively small drops, while petroleum & coal, nonferrous metals, and wholesalers saw sharp declines. A third-party committee’s investigative report was released... $Nidec (6594.JP)$ Sea shares surged despite starting under selling pressure, driven by expectations that negative factors had been fully priced in, followed by strong buying interest. Conversely, nonferrous metal sector stocks were heavily sold off, with... $JX Advanced Metals (5016.JP)$ ...experiencing a sharp drop on heavy trading volume.

[Today's Buy/Sell Dominance Situation]

On March 4, in the TSE Prime Market, buy-dominant volume amounted to 1.34 trillion yen, while sell-dominant volume reached 1.68 trillion yen.

Top News
Ibiden has sharply declined for three consecutive days as the stake held by a Singapore-based investment company dropped to 3.80%.
$Ibiden (4062.JP)$ Ibiden has sharply declined for three consecutive days. On the morning of the 4th, Ibiden's stock was trading in positive territory, but selling emerged following news that the stake held by GIC, based in Singapore, had decreased. According to the amendment report filed on the same day, GIC’s ownership fell from 5.07% to 3.80%. The mandatory reporting date was February 25. GIC's investment purpose is categorized as pure investment.

[Stocks to Watch] Nidec rebounds from early losses = Negative factors appear priced in for now
$Nidec (6594.JP)$ The stock rose by 432 yen from the previous day to 2,698 yen, turning positive and extending gains. Market participants noted, 'Buying to cover short positions seems to have strengthened as some view that negative factors are fully priced in for now' (domestic brokerage).

On the 3rd, the company released a third-party committee's investigation report concerning improper accounting allegations. It estimated the impact of fraudulent accounting on net assets at approximately 139.7 billion yen and also revealed the possibility of recording an impairment loss of around 250 billion yen in its automotive components business.

In November last year, the company announced it would record an impairment loss of about 87.7 billion yen. However, market sources stated, 'The emergence of a possible larger-than-expected impairment loss raised concerns about the negative impact on earnings,' leading to early selling pressure, with the stock opening 100 yen lower than the previous day at 2,166 yen.

Subsequently, 'the publication of the third-party committee's interim investigation report led to the perception that near-term negative factors have been fully priced in' (domestic brokerage), prompting bargain hunting, which pushed the stock up significantly by 432 yen above the previous day’s close around 9:30 AM.

However, 'there remain several matters to confirm, such as the content of the upcoming final investigation report by the third-party committee' (major brokerage), and 'it remains unclear how the company plans to recover its performance' (aforementioned domestic brokerage), raising doubts about whether the stock price will continue to rebound. (9:50 AM)

Nomura Crude Oil and other crude oil ETFs are rising amid escalating tensions in the Middle East, with WTI reaching an eight-month high at one point.
$NEXT FUNDS NOMURA Crude Oil Long IdxLnkd (1699.JP)$や$Simplex WTI ETF (1671.JP)$ Exchange-traded funds (ETFs) linked to crude oil prices are rising. The April contract for West Texas Intermediate (WTI) crude oil futures surged 3.33 dollars on March 3rd to 74.56 dollars per barrel, briefly reaching 77.98 dollars, the highest level since June of last year — about eight months ago. Amid growing concerns over prolonged attacks on Iran by the US and Israel, upward momentum in crude oil prices has intensified.

BrightPath sharply rebounded on expectations of receiving a U.S. patent decision related to BP2301, which is under U.S. application.
$BrightPath Biotherapeutics (4594.JP)$ The stock sharply rebounded. On this day, the company announced that the U.S. Patent and Trademark Office's website disclosed that 'the examination has been completed, and it has been concluded that the patent can be issued' regarding the application related to BP2301 under development, which is being viewed as positive material. This patent relates to the manufacturing method of the self HER2 CAR-T cell therapy BP2301, which is currently in Phase 1 clinical trials. The company has already received patent approval notifications in Japan and China, and in the U.S., it will receive formal notification via local agents and domestic patent offices. It stated that there will be no impact on its financial performance for the fiscal year ending March 2026 due to this matter.

Kawasaki Heavy Industries continued its decline after signing a memorandum of understanding with a German company regarding next-generation construction machinery and hydrogen solutions.
$Kawasaki Heavy Industries (7012.JP)$ Shares continued to fall. On the 3rd, Kawasaki Heavy Industries announced that it had signed a Memorandum of Understanding (MOU) with Bosch Rexroth of Germany, aiming to drive innovation and sustainability at future construction sites and accelerate the realization of a hydrogen society through collaboration on next-generation construction machinery and hydrogen solutions.

Through this MOU, combining Kawasaki Heavy Industries’ precision hydraulic hardware and skilled shovel systems with Bosch Rexroth’s system expertise, advanced and extensive electronics and software, the companies aim to address major challenges in the construction machinery industry, such as improving job site safety, autonomous driving, seamless data exchange, and accelerating the transition to sustainable energy sources, thereby creating the concept of intelligent machines. They also agreed to promote cooperation on equipment related to hydrogen fuel filling stations to realize innovative hydrogen solutions.

Meanwhile, the stock price softened along with the overall weak market sentiment.

Kubota Pharmaceutical HD significantly fell for the fourth consecutive day, pressured by profit-taking and deteriorating market conditions.
$Kubota Pharmaceutical Holdings (4596.JP)$ The stock significantly declined for four consecutive days. There have been no notable sell-side materials, but the stock has fallen with trading volume. Following the announcement of Kubota Pharmaceutical Holdings’ earnings forecast for the fiscal year ending December 2025 (an operating loss forecast of 877 million yen compared to a prior-year loss of 1.345 billion yen), the stock surged and hit its highest level in over a year on February 13. Since then, profit-taking and worsening sentiment across the growth market have led to a weak performance, with the stock trading below its 25-day moving average.

Kajima fell for three consecutive days after developing the 'Face Evaluation System' for mountain tunnel construction.
$Kajima (1812.JP)$ The stock fell for three consecutive days. On the 4th, Kajima announced that it had developed a 'Face Evaluation System' for quantitatively analyzing and evaluating the characteristics of the tunnel face, the forefront of mountain tunnel construction.

The system quickly and safely collects face data from photos taken on smartphones, acceleration sensors installed on excavator breakers, and LiDAR mounted on spraying machines. By utilizing the company’s proprietary analysis software, it enables accurate and quantitative evaluation of face conditions. Furthermore, the evaluation results of these face conditions can be automatically output as electronic data in the form of face observation reports.

However, the positive impact on the stock price has been limited.

[Top Moving Japanese Stocks]
The components of the Nikkei 225 generally declined, worsening market sentiment. Within this context,$BayCurrent (6532.JP)$The stock ranked at the top of today's gainers list, closing 5.61% higher at 4498.0 yen.

On the other hand, the stock with the largest decline was$Kyowa Kirin (4151.JP)$The closing price fell by 18.31% to 2231.0 yen.

Japanese and US stocks in one app! Discover promising stocks through various rankings in the “Market” > “Japanese Stocks/US Stocks” > “Various Rankings” section of the moomoo app.

-moomoo News Japanese Stocks August

Source: MINKABU, FISCO, Trader's Web, Stock Newspaper, Jiji Press

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