Tokyo Stocks Close Mixed as Middle East Tensions Weigh on Markets

Tokyo stocks ended mixed on Friday as persistent uncertainties surrounding Middle East peace negotiations dampened buying momentum. The Nikkei 225 index rose 196.57 points, or 0.28 percent, to close at 71,250.06, while the broader Topix index fell 23.22 points, or 0.57 percent, to 4,044.96—marking its first decline in three sessions.

The market opened with strength, with the Nikkei hitting a fresh intraday high near the 72,000 level, buoyed by overnight advances on Wall Street driven by semiconductor-related stocks. However, the gains proved short-lived as investors grew cautious over unresolved peace talks between the United States and Iran. This uncertainty prompted crude oil futures to rise, creating headwinds for equity investors.

Currency markets also reflected the prevailing geopolitical tensions. The Japanese yen weakened to the upper 161 zone against the U.S. dollar, approaching its lowest level in more than 39 years. Finance Minister Satsuki Katayama issued a warning of "decisive" action in response to potential speculative currency movements, though the market showed limited reaction to her statement. The yen's depreciation reflects broader concerns about regional stability and its potential impact on Japanese exports and economic conditions.