How the Japanese Stock Sell-Off Could Influence Crypto Prices?

Published by

Vignesh S G

September 13, 2024

The Japanese market is experiencing a highly volatile situation. According to a report published in Bloomberg, foreign investors offloaded a massive $5.78 billion worth of Japanese equities last week. This marks the biggest selling in nearly a year and has raised concerns about the future of the Japanese economy.

Meanwhile, the US market also has shown signs of volatility. Concerns over volatility in two influential economies, the US and Japan, point to the possibility of the emergence of a global economic slowdown. How will this impact the crypto market? Let’s find out!

Why Are Foreign Investors Selling Japanese Stocks?

According to the report, this was the third consecutive week of net selling by foreign investors. The report pointed out the yen’s recent rebound as one of the major factors driving this sell-off.

How Japanese Retail Investors React to The Sell-Off

The report noted that Japanese retail investors used foreign investors’ sell-off as an opportunity to amass stocks. It stated that at least 467 billion Japanese yen worth of stocks were purchased by local investors exploiting the sell-off of foreign investors. The report also highlighted the significant share buybacks conducted by Japanese corporations during the period.

Could This Impact the Crypto Market?

If the investors who left the Japanese market decide to enter the crypto market, it could mark the beginning of a new bullish momentum in the crypto market. Generally, whenever there is volatility in traditional markets, investors shift to assets like cryptocurrencies as a hedge against economic uncertainty.

In conclusion, the heavy selling of Japanese stocks by foreign investors and the slowdown of the US economy signal growing concerns about the global economy. However, this could be an opportunity for the cryptocurrency market.

Stay tuned to Coinpedia for more updates about the global economic situation!

Vignesh S G

Vignesh is a young journalist with a decade of experience. A proud alumnus of IIJNM, Bengaluru, he spent six years as a Sub-Editor for a leading business magazine, published from Kerala. His interest in futuristic technologies took him to a US-based software company specialising in Web3, Blockchain and AI. This stint inspired him to view the future of journalism through the lens of next generation technologies. Now, he covers the crypto scene for Coinpedia, uncovering a vibrant new world where technology and journalism converge.