Nikkei 225 falls 2.65% to 62,907.84 in Tokyo; Japan CPI at 2.7%

The Nikkei 225 stood at 62,907.84 at 15:25 Tokyo time on Thursday, October 22, 2026, down 1,713.4 points or 2.65% from the previous close. Japan's September inflation rate came in at 2.7% year on year, against a 2.3% estimate.

What happened

Tokyo's benchmark index ended the session under pressure. The Nikkei 225 was at 62,907.84 five minutes before the 15:30 close. The previous close was 64,621.24, so the index lost 1,713.4 points, a decline of 2.65%.

The Tokyo Stock Exchange trades in two sessions each day. The morning session runs from 09:00 to 11:30 and the afternoon session from 12:30 to 15:30, Tokyo time. The 62,907.84 level is the last reading of the afternoon session before the closing bell.

The Nikkei 225 tracks 225 large companies listed in Tokyo. It is the index most often quoted when Japanese equities are discussed. Its move on Thursday came on the same day as a new inflation reading and a change in the yen.

Japan inflation data

The main domestic data point was the inflation release. Japan's consumer inflation rate for September was 2.7% year on year.

Inflation data matter in Japan because they feed into the discussion about interest rates and the value of the yen. The release is classed as high impact in the economic calendar. It was the only high-impact Japanese row in the data for the day.

The yen and the regional backdrop

USD/JPY stood at 157.16 at 06:45 UTC. The pair was down 0.90 yen, or 0.57%, from the previous close of 158.06. A lower USD/JPY reading means the yen was stronger against the dollar than at the previous close.

The yen matters for Japanese equities because many large listed companies earn revenue abroad. Currency moves change how those overseas earnings are translated into yen. Exchange-rate shifts are therefore a standard part of the daily reading of the Tokyo market.

Elsewhere in Asia, India's market was also lower on Thursday. The Sensex dropped over 600 points, and the Nifty 50 slipped below 22,600 during an expiry-day session marked by volatility. Nearly Rs 5 lakh crore of investor wealth was erased, and market breadth was firmly negative.

On Wednesday the Nifty 50 had already fallen 77.60 points to close at 22,811.35. Selling that day was concentrated in banking stocks. The index therefore began Thursday from that level before moving below 22,600.

Background and previous values

The inflation reading of 1.9% in the previous period is the reference for this release. The step to 2.7% is the largest piece of new information in the Japanese calendar for the day. Taken together with the equity decline and the yen move, it makes Thursday a busy day for Japanese markets.

The Nikkei 225 previous close of 64,621.24 is the base for the day's decline. The yen's previous close of 158.06 is the base for the currency move. Both comparisons use the prior session as the starting point, so they describe one-day changes only.

Indian corporate news was also active during the week. ICRA reaffirmed the Rs 12,000 crore non-convertible debenture programme of Reliance Industries. Eternal reported year-on-year growth in second-quarter revenue and net profit. These items concern single companies and are separate from the index-level moves described above.

The Indian figures come from two different sessions. The Wednesday close of 22,811.35 on the Nifty 50 was a completed session. The Thursday readings, with the Sensex down more than 600 points and the Nifty 50 below 22,600, describe a session that was still under way when the Tokyo market was closing.

Why it matters

The Nikkei 225 is a widely followed gauge of Japanese equities. A decline of 2.65% in a single session, from 64,621.24 to 62,907.84, is a large change in points, at 1,713.4. International investors who hold Japanese shares track the index daily.

The inflation figure matters for a separate reason. At 2.7%, the annual rate is well above the 1.9% recorded in the previous reading. Price data of this kind shape the debate on monetary policy, which in turn affects bond yields, the currency and equity valuations.

The yen's move adds a third element. USD/JPY at 157.16 stood below the previous close of 158.06. Equities, inflation and the exchange rate all changed on the same day, and each of them is a separate input for companies and households in Japan.

The weakness in India shows that the decline was not limited to Tokyo. Even so, the Indian moves were tied to expiry-day volatility and to earlier selling in banking stocks. Those are local factors, so the two markets should not be treated as having one common cause.

What to watch next

The next Tokyo session opens at 09:00 local time. The official close for Thursday will serve as the reference point for the Nikkei 225, alongside the 62,907.84 level recorded at 15:25 and the previous close of 64,621.24.

On the data side, attention stays on how the 2.7% inflation rate is discussed by officials and market participants. Their comments on the move from the 1.9% previous reading will frame the debate on Japanese monetary policy.

The yen is the second item to follow. USD/JPY at 157.16 can change through the day. Its position against the previous close of 158.06 will show whether the yen's move continues or reverses.

In India, the Nifty 50 is below 22,600 after Wednesday's close of 22,811.35. The next sessions will show whether the negative breadth seen on Thursday persists once the expiry-day volatility has passed. Company news, including the items from Reliance Industries and Eternal, will continue to affect individual stocks.