[As of the morning of October 17] Japanese stocks rebounded, but US tech stocks fell again. 3 scenarios to check at the start of the week
The Nikkei Stock Average rose 898 yen on Friday. However, in the subsequent US market, the NASDAQ 100 fell 2.50%.
“Japanese stocks finally recovered, but will they fall again on Monday?”
You are probably wondering about that. However, the results at the start of the week are not determined solely by the decline in US stocks.
In this article, I will organize what is weighing on the rebound and the order in which you should check things at the start of the week.
Conclusion first
The overall assessment is bearish in the short term. However, this does not mean that a decline in Japanese stocks is certain.
The decline in US tech stocks and the heightened caution regarding stock price volatility are headwinds. On the other hand, even in the US, there is a divergence in strength depending on the sector. What I want to check is whether the selling will spread to all Japanese stocks or if it will be concentrated in areas like semiconductors.
What happened in the US market?
[Fact] As of the close of the US market on the 16th, the S&P 500 was at 7,659.44, down 1.09% from the previous day. The Dow was at 52,002.41, down 0.34%. The NASDAQ 100 was at 29,187.55, down 2.50%.
The NASDAQ 100 is an index centered on large non-financial companies in the Nasdaq market. It is different from the NASDAQ Composite, and this time I am using the NASDAQ 100 as the benchmark.
The VIX rose to 19.98. The VIX is an indicator that shows the magnitude of future volatility implied by S&P 500 option prices. An increase indicates heightened caution, but it is not a number that guarantees a decline the next day.
Why were tech stocks weak?
[Report] Concerns continue in the market regarding the borrowing and financing that support capital investment for AI. While technology-related stocks were a drag on the US market, there were times when buying flowed into energy and utilities.
[Analysis] The increase in demand for AI and the fact that such investment leads to sufficient profit or cash income are two different things.
To put it simply, even if you borrow money to open more stores, you need not only sales but also money to repay the debt.
Expansion of AI capital investment
↓
Focus on debt burden and investment recovery
↓
Re-evaluation of expectations for future profits
↓
Possibility of price adjustment for related stocks
It cannot be said for sure that “If AI grows, all related stocks will rise.”
How were the new price statistics?
[Fact] US import prices for September rose 1.1% month-on-month. The growth expanded from the revised 0.5% increase in August. Even excluding fuel, they rose 0.7%. Export prices rose 2.2%.
Import prices are the movement of prices for goods purchased from overseas. They are material for considering corporate costs and domestic prices, but they are not passed on to consumer prices in the same proportion.
[Analysis] Price pressure remains. However, we cannot attribute this stock decline solely to this one statistic. Since the comparison with market expectations has not been confirmed, I will not write that it ‘exceeded expectations’.
Although a decline was observed on the US Treasury yield acquisition screen, stock prices still fell. It is not a simple relationship where interest rates falling always leads to stocks rising.
How does this connect to Japanese stocks and foreign exchange?
The Nikkei Stock Average’s most recent closing price is 65,324.29 yen, up 898.34 yen from the previous day. This is the result of the Japanese trading session on the 16th, which ended before the US decline on the 16th. It is not the new price movement of Japanese stocks on Saturday.
The dollar-yen rate was 158.05 yen as of 4:00 on the 17th. While it was in the direction of a stronger yen from 158.24 yen at 2:00, this change over two hours is not called a day-over-day change.
Bank of Japan Governor Ueda has indicated a policy of raising the policy interest rate and adjusting the degree of easing in response to economic and price conditions. When looking at Japanese stocks, it is necessary to check not only the US, but also Japanese interest rates and foreign exchange.
3 scenarios for the start of the week
1. If selling spreads to the entire Japanese stock market
This is a case where caution intensifies following the decline in US tech stocks, and both the Nikkei Average and TOPIX weaken. We will check the spread of declining stocks, not just semiconductors. We will move away from the assumption of a rebound and review our allowable losses and capital allocation.
2. If semiconductors are weak, but other sectors provide support
There is a possibility that capital will move between sectors and the TOPIX will be more resilient than the Nikkei Average. Instead of summarizing that ‘all Japanese stocks are weak,’ we will record the gains and losses by sector and the outlook for companies.
3. If the selling at the opening is absorbed and a recovery occurs
This is a case where concerns are eased by new weekend developments, and buying returns to both semiconductors and the TOPIX. We will not judge based solely on the initial rebound, but will confirm whether it can be maintained throughout the morning and afternoon sessions. If a broad-based recovery continues, we will revise our bearish assessment.
This is an organization by condition, not a probability of occurrence or a stock price target.
Things to prepare over the weekend
・For corporate financial materials, check not only sales but also profits, cash flow, borrowings, and company outlooks. ・Separate weekend Middle East developments and oil-related news into confirmed facts and speculation. ・At the start of the week, check the dollar-yen rate and US futures before proceeding to the opening of Japanese stocks. ・Compare the spread of the Nikkei Average, TOPIX, and semiconductor stocks during the morning and afternoon sessions. ・Keep the option of sitting out if the conditions are not met.
The next FOMC is scheduled for October 27-28 (US date), and the year-end meeting is December 8-9. The FOMC is a meeting to decide US monetary policy. We will not jump to conclusions about the results at this time.
In short
It is important to look at the rebound of Japanese stocks on Friday and the subsequent decline in US stocks by separating them chronologically 💡
At the start of the week, rather than ‘guessing whether it will go down,’ let’s check ‘how far the selling will spread’ and ‘whether the rebound will continue’.
Sources, unverified items, and disclaimers
October 17, 2026 morning edition, reconfirmed at 0:00 on the 19th. US stocks as of the 16th, Japanese stocks as of the 16th closing price, and exchange rates as of 4:00 JST on the 17th
S&P 500 / NASDAQ 100 / Dow / VIX / Nikkei Index Official
BLS Import/Export Prices / Reuters Market Reports / Exchange Rates/DZH / Key Official Statements/DZH / FRB Meeting Schedule
* No holdings are registered. This article is for general information purposes only and does not recommend or solicit the purchase, sale, or holding of any specific financial product. Scenarios do not guarantee future prices.