Japan's main stock market barometer, the Nikkei 225, closed at 61,434.19 on July 29, 2026, down 1.49% for the day. Shares of electronics companies actually gained ground during the trading session, but the improvement wasn't enough to overcome the broader wave of selling. Reuters

It's been a painful two weeks for Japanese stocks. On July 17, the Nikkei dropped 4.03% to 64,141.12, falling into what traders call a correction — a drop of roughly 10% or more from a recent high. That was driven by a global selloff in technology shares and escalating conflict in the Middle East. Reuters A week later, on July 24, the index fell another 2.73% to 64,611.15 as investors worried that companies were spending too much on artificial intelligence. Reuters On July 27, the slide deepened, with the Nikkei closing 3.95% lower at 62,364.92. CNBC

The numbers tell a blunt story. From the July 17 close through July 29, the Nikkei lost roughly 2,707 points — about 4.2% of its total value — in just eight trading sessions. Based on the available data, the index did not post a single positive close during that entire stretch.

The reason the electronics gain on July 29 matters is that this same sector has been at the heart of the selloff. The Japan Exchange Group tracks electronics and precision-instrument companies through a category called the TOPIX-17 Electric Appliances & Precision Instruments index. JPX JPX also tracks electric appliances as a separate sector. JPX J-Quants A fund called NEXT FUNDS offers an ETF (ticker 1625) that lets investors buy into this group of companies as a package. NEXT FUNDS

Because electronics companies make up such a large share of the Nikkei, when their shares rise, the whole index feels the lift. But the reverse is also true. The worries about AI spending that drove the July 24 drop, and the technology selloff on July 17, hit those same companies hardest.

There's a broader backdrop to consider. The S&P/TOPIX 150, a combined measure of large Japanese companies run by S&P Dow Jones Indices and JPX, stood at 3,482.24 as of July 29, 2026, with a one-year return of 37.73%. S&P DJI That strong annual figure, though, hides what's happened lately. A 37.73% gain over twelve months means the index was much higher earlier in the year before the current slide started eating into those profits.

The question for anyone watching this market is whether the electronics gain on July 29 reflects real confidence that stocks have bottomed out, or just investors shuffling money between sectors while the overall trend stays downward. A 1.49% daily drop that follows a 3.95% plunge, with electronics ticking upward, could mean bargain hunters are stepping in to buy oversold shares — or it could be a temporary blip in a market that's still falling. The data needed to tell those two scenarios apart isn't available from the verified facts at hand.

What the sequence makes clear is that the correction that started in mid-July hasn't found a solid floor yet. Every session in the available record shows the index closing lower than the one before, with electronics acting as both the main drag during the worst selloff days and the main source of any attempted comeback. For investors holding the NEXT FUNDS 1625 ETF or similar funds tied to this sector, that works both ways: the same sensitivity that magnified losses on the way down will magnify gains if and when the market turns around.