Nikkei Drops Over 600 Yen, Closes Down 338 Yen Amid Middle East Tensions and U.S.-Iran Conflict Fears

The Nikkei Stock Average experienced a notable decline in mid-June 2025 amid escalating tensions in the Middle East. On June 13, the index dropped over 600 yen at one point, influenced by concerns over Israel's attack on Iran and broader geopolitical instability. The market volatility was compounded by a stronger yen and declining interest rates. Although the index partially recovered, it closed down 338 yen on June 13. Subsequent trading sessions saw continued caution, with the Nikkei retreating from a four-month high as fears of potential U.S. involvement in the Iran conflict persisted. By June 19, Tokyo stocks ended a three-day winning streak, reflecting ongoing unease over the Middle East situation. This regional tension also affected other markets, with European and Asian shares retreating due to heightened risk aversion. Indian equities similarly showed subdued performance amid the conflict's impact on global investor sentiment.