| entity | type | weight | basis | confidence | lastUpdated | references |
|---|---|---|---|---|---|---|
| EV001 | event | 30% | Japan imports 90% of oil from Middle East; Hormuz blockade is the dominant near-term driver. Oil at ~$100+ directly impacts energy costs for manufacturers and households. Every sector except defense is pressured. This factor alone explains the 8.5% correction from ATH. | high | 2026-03-13 | EV001,SF001,SF002,SF003 |
| EV008 | event | 20% | The flip side of the oil shock — if war ends in 2-4 weeks as Trump signals, this is the primary catalyst for rebound. Timeline is compressed vs prior 4-6 week estimates. Market will front-run resolution; any de-escalation news could trigger sharp relief rally. | medium | 2026-03-13 | EV008,SF004,SF015,SF016 |
| EV004 | event | 15% | Weak yen at 159 amplifies import cost inflation from oil shock. However, it also supports export competitiveness. Mixed impact but net negative in current stagflation environment where cost inflation outweighs export benefit. Intervention risk creates asymmetric upside potential for yen. | high | 2026-03-13 | EV004,SF007,SF008 |
| EV005 | event | 10% | March 18-19 meeting is upcoming catalyst. Rates at 30-year high already priced; uncertainty is whether BoJ delays further hikes due to oil shock. Hawkish surprise would be bearish for equities; dovish delay would be mild bullish. Terminal rate path 1.25-1.75% is structural overhang. | medium | 2026-03-13 | EV005,SF009,SF010,SF011 |
| EV007 | event | 10% | Japan's largest export market showing weakness. NFP -92K, unemployment 4.4%, ISM prices 70.5 signals stagflation. But Japan has diversified export destinations (China, ASEAN) reducing single-market dependency. Weight limited by war dynamics dominating. | high | 2026-03-13 | EV007,SF012,SF013,SF014 |
| EV012 | event | 5% | VIX ~30+ reflects global risk aversion that suppresses foreign flows into Japanese equities. However, VIX is a symptom not a driver — will normalize when war uncertainty resolves. | medium | 2026-03-13 | EV012 |
| EV009 | event | 4% | Domestic headwind but Q3 was pre-conflict; current weakness is oil-driven. BoJ upgraded forecasts suggest base case is mild recovery. Secondary importance while external shock dominates. | high | 2026-03-13 | EV009,SF017 |
| EV010 | event | 3% | Structural positive for domestic consumption and supports BoJ's normalization thesis. However, in near-term oil shock environment, consumption support is overwhelmed by cost pressures. Long-term bullish but low current weight. | high | 2026-03-13 | EV010,SF018,SF019 |
| EV002 | event | 2% | Largest ever coordinated release but failed to sustainably lower prices — Brent recovered from $84 crash to ~$101. Market has already discounted this intervention. Residual support only. | high | 2026-03-13 | EV002,SF005,SF006 |
| EV013 | event | 1% | MHI, KHI outperforming but represent small index weight. Structural shift in regional security spending is multi-year theme but minimal current index impact. | medium | 2026-03-13 | EV013 |
| Field | Value |
|---|---|
| Overall Bias | bearish |
| Confidence | medium |
| Time Horizon | 2-4 weeks (tied to Iran-US war resolution timeline) |
| Key Driver | EV001: Middle East Oil Supply Shock (30% weight) - Japan's 90% dependency on Middle East oil imports makes the Hormuz blockade the dominant price driver, explaining the 8.5% correction from ATH |
| Key Risk | War resolution faster than 2 weeks would trigger sharp relief rally; market will front-run de-escalation (EV008) |
| rank | id | name | type | why |
|---|---|---|---|---|
| 1 | EV001 | Middle East Oil Supply Shock | unified-event | 30%% influence weight. Japan imports 90% of oil from Middle East; Hormuz blockade is the dominant near-term driver. Oil at ~$100+ directly impacts energy costs for manufacturers and households. Every sector except defense i |
| 2 | EV008 | War Wind-Down Signal — 2-4 Weeks | unified-event | 20%% influence weight. The flip side of the oil shock — if war ends in 2-4 weeks as Trump signals, this is the primary catalyst for rebound. Timeline is compressed vs prior 4-6 week estimates. Market will front-run resoluti |
| 3 | EV004 | Yen Depreciation to 159 | unified-event | 15%% influence weight. Weak yen at 159 amplifies import cost inflation from oil shock. However, it also supports export competitiveness. Mixed impact but net negative in current stagflation environment where cost inflation |
| 4 | EV005 | BoJ Rate Normalization | unified-event | 10%% influence weight. March 18-19 meeting is upcoming catalyst. Rates at 30-year high already priced; uncertainty is whether BoJ delays further hikes due to oil shock. Hawkish surprise would be bearish for equities; dovish |
| 5 | EV007 | US Economic Weakness — Stagflation Risk | unified-event | 10%% influence weight. Japan's largest export market showing weakness. NFP -92K, unemployment 4.4%, ISM prices 70.5 signals stagflation. But Japan has diversified export destinations (China, ASEAN) reducing single-market de |
| scenario | probability | priceTarget | keyAssumption | keyEvents |
|---|---|---|---|---|
| Base — Gradual Resolution | 50% | 52,000-54,000 | War winds down in 2-4 weeks as signaled; BoJ holds rates March 18-19; oil declines to $90-100 range | EV001,EV008,EV004,EV005 |
| Bear — Prolonged Conflict | 25% | 48,000-50,000 | War extends beyond 4 weeks; oil stays >$110; BoJ hikes to 1.0% despite shock; US enters recession | EV001,EV007,EV005,EV012 |
| Bull — Rapid De-escalation | 25% | 56,000-58,000 | War ends within 1-2 weeks; oil drops to $80-85; BoJ delays hike citing uncertainty; risk-on rally | EV008,EV002,EV010,EV013 |
| id | risk | trigger | wouldChangeBiasTo | monitoringSignal |
|---|---|---|---|---|
| R001 | Faster war resolution | Trump announces ceasefire or Iran capitulation | bullish | White House statements; Hormuz traffic resumption; oil below $85 |
| R002 | BoJ hawkish surprise | Rate hike to 1.0% on March 18-19 despite oil shock | more bearish | BoJ statement language; Takata dissent outcome; terminal rate guidance |
| R003 | Yen intervention | USD/JPY breaks 160+ | bullish | BoJ FX intervention announcement; sharp yen rally >3% intraday |
| R004 | US recession confirmed | Q1 2026 GDP negative + continued job losses | bearish | NFP prints; GDP advance estimate; ISM below 50 |
| R005 | Iran escalation | Retaliation on Gulf infrastructure or tanker attacks | very bearish | IRGC statements; tanker incidents; Brent >$120 sustained |
| priority | id | item | checkFrequency | nextCheck | triggerCondition |
|---|---|---|---|---|---|
| 1 | MP001 | Iran-US war status and Trump statements | daily | 2026-03-14 | Any ceasefire announcement or timeline change |
| 2 | MP002 | Brent crude price | daily | 2026-03-14 | Move below $90 or above $110 |
| 3 | MP003 | USD/JPY level | daily | 2026-03-14 | Break above 160 (intervention trigger) or below 155 (relief rally) |
| 4 | MP004 | BoJ March 18-19 meeting | event-driven | 2026-03-19 | Rate decision and statement language |
| 5 | MP005 | Hormuz Strait traffic | daily | 2026-03-14 | Significant vessel passage or insurance normalization |
| 6 | MP006 | US PCE release (today) | event-driven | 2026-03-13 | Above 0.4% MoM would fuel stagflation narrative |
| 7 | MP007 | Foreign investor flows | weekly | 2026-03-20 | Net selling >$5B weekly would confirm risk-off |