Could tomorrow, Monday, turn into a “Black Monday”? Nikkei 225 futures are down 1,890 yen.

U.S. stock markets also plunged on Friday: the NASDAQ 100 fell 2.5%, and the semiconductor index SOX dropped 3.8%.

This downturn could be reflected in the Japanese market during tomorrow’s trading session.

Are people investing through Japan’s new NISA program at risk? Could their assets fall further on Monday? What’s happening, and how should they prepare?

👉 First, let’s look at the Japanese stock market.

The Nikkei 225 closed 898 points higher on Friday. However, after the Tokyo market closed, U.S. stocks plunged.

As a result, on Saturday morning, Nikkei 225 futures fell to 63,630 points. That’s about 1,694 points below Friday’s closing level of 65,324.

Wait! Could the Nikkei really fall by 1,700 points right at Monday’s open?

That’s a figure investors should be wary of. However, remember that futures can’t accurately predict where the market will close on Monday. What actually happens will still depend on trading activity during that day’s session.

And here’s what’s especially worth noting, particularly for those investing through Japan’s new NISA program.

In fact, even investment funds are facing losses that haven’t yet been fully reflected in their current values.

The weekly returns for popular investment funds, as reported on Friday:

  • Slim S&P 500: −0.25%

  • Slim All Country (Orukan): −0.48%

  • iFreeNEXT NASDAQ100: −2.57%

  • Nissay SOX: −8.25%

However, U.S. markets continued to plunge on Friday night. The NASDAQ 100 fell a further 2.50%, while the semiconductor index SOX dropped as much as 3.83%.

In principle, this decline will be reflected in the funds’ net asset values (NAVs) on Monday.

Assuming exchange rates remain unchanged, for a portfolio worth 10 million yen, Friday night’s drop in U.S. stocks alone could reduce its value by approximately:

  • S&P 500: −109,000 yen

  • NASDAQ 100: −250,000 yen

  • FANG+: −316,000 yen

  • SOX: −383,000 yen

Note: Actual NAV values will also depend on exchange-rate movements and other factors.

It’s genuinely scary to think about Monday’s trading session!

But if you panic and sell everything right now, what lies ahead could be even scarier.

👇 The next part is what investors really need to pay close attention to!

Do you remember?

On August 5, 2024, Japan experienced what became known as “Reiwa’s Black Monday.” In a single day, the Nikkei 225 plunged 12.40%.

“Japanese stocks are finished! Get out now!”

However, the very next day, the Nikkei 225 surged 10.23%.

Huh? It plunged so disastrously yesterday—how did it surge so much today?

The market didn’t rise because everyone had stopped being afraid. On the contrary, a wave of short-covering swept in while the crowd was still panicking.

This is what investors call a “lightning-strike moment”—the strongest rallies often happen when markets are extremely volatile.

If you sell off during a market crash and wait until things stabilize before coming back, you could miss most of the recovery. By the time you feel safe enough to buy back in, stock prices may have already surged.

Of course, there’s no guarantee the market will recover right away this time.

But remember: selling out of fear can also end up costing you dearly.

🚨 A brutal Monday—what should NISA investors do?

If the Japanese market plunges again tomorrow, the first thing I’ll do is stay calm—not sell everything.

There are three things I think investors should keep in mind:

1️⃣ Don’t panic-sell just because the market is down.

For funds like Slim S&P 500, placing a sell order on Monday doesn’t mean you’ll sell at the price you see on screen. The transaction price is generally determined using the NAV on the next business day, depending on the fund’s rules.

2️⃣ If you’re investing for the long term, stick to your plan.

Continue your regular contributions in line with your finances and the strategy you’ve set. If you want to buy more during a downturn, decide in advance how far the market should fall and how much you’ll invest.

Don’t wait for the market to turn red and then make an emotional decision.

3️⃣ You don’t need to force yourself to do anything if you’ve used up your NISA allowance.

A market downturn doesn’t automatically mean you should buy more. If you’ve already used your annual investment allowance, it’s perfectly fine to sit tight and wait.

One detail worth noting: by the end of the week, TOPIX was down just 0.95%, while the Nikkei 225 had fallen as much as 5.37%. This shows that Japanese stocks didn’t all decline by the same amount.

📌 What I want to remind myself is this:

The U.S. market fell on Friday night, and the Japanese market reflected that on Monday. This may be a delayed reaction to the same sell-off, rather than an entirely new crash.

Prices can change every day, but that doesn’t mean we have to change our investment decisions every day.

The days when the market scares you the most are also the days when you need the most discipline.

Next Monday, will you keep holding, buy more, or stay on the sidelines and watch?

I’d love to hear what you think. 👇