Nikkei drops as bond yields slide on global flight to safety

Japan’s benchmark equity index Nikkei dropped in early trading as government bond yields took a hit, while Yen rose on global flight to safety.

At the time of writing, Nikkei was trading 2% or 318 points lower at 15,351 levels. Yen strengthened across the board on account of risk aversion and thus weighed over stock prices.

Meanwhile, the 20-year Japanese government bond yield dropped to 0.0%. Bond yields have been sliding across the globe on fears of recession. Moreover, Brexit fallout continues to worsen and force investors to take cover under the safe haven assets.

Nikkei Technical Levels

A breakdown of immediate support at 15,243 (mid Feb low), under which prices could target 15,000 levels. Next major support is seen at 14,864 (Brexit low). On the other side, resistance is seen at 16,605 (weekly 200-MA) and 15,805 (weekly high). A break higher would expose 16,000 levels.