Japanese Stock Market Potential to Reverse Tuesday's Advances

Crude oil prices surged on Tuesday due to concerns about supply disruptions following strikes on Russian energy sites by Ukraine. West Texas Intermediate crude for October delivery was up $1.51 or 2.36 percent at $65.52 per barrel.

Meanwhile, the Japanese stock market ended a two-day losing streak on Tuesday. The Nikkei 225 is currently above the 42,310-point plateau. The Nikkei finished modestly higher on Tuesday, with gains from automobile producers and financial shares. Specifically, Nissan Motor added 0.54 percent, Mazda Motor accelerated 1.76 percent, and Toyota Motor rose 0.37 percent on Tuesday. Technology stocks in the Nikkei were mixed on Tuesday.

Honda Motor and Mitsubishi Electric both perked 0.09 percent, while Softbank Group shed 0.45 percent, Mitsubishi UFJ Financial advanced 0.96 percent, Mizuho Financial collected 0.81 percent, Sumitomo Mitsui Financial jumped 1.82 percent, Sony Group dipped 0.17 percent, and Panasonic Holdings rallied 1.42 percent on Tuesday. Hitachi lost 0.38 percent on Tuesday.

The global forecast for Asian markets remains negative due to renewed ambiguity surrounding U.S. tariff policies. The U.S. Court of Appeals for the Federal Circuit ruled on August 29, 2025, in a 7-4 decision that most of President Trump's tariffs were illegal because he exceeded his authority under the International Emergency Economic Powers Act (IEEPA) of 1977. Treasury yields surged in reaction to the ruling, raising concerns about potential government repayment of tariff revenues.

The Institute for Supply Management released a report showing a slight increase in U.S. manufacturing activity in August, but the index still posted its sixth consecutive month of contraction. The lead from Wall Street is weak, with the major averages opening lower and remaining in the red throughout the day.

On the legal front, the U.S. Court of Appeals for the Federal Circuit also ruled most of President Trump's global tariffs as illegal on August 29, 2025, in a 7-4 decision. The ruling could have significant implications for the U.S. economy and international trade. The renewed ambiguity surrounding U.S. tariff policies continues to cast a shadow over the global markets.