Japan: the stock market falls 1.93% in one day, its worst week in months

WHAT HAPPENED

The Japanese Nikkei fell 1.93% on Friday and closed at 64,011 points. Oil, between $103 and $108 per barrel, raised fears of inflation and higher interest rates. Chip stocks were the hardest hit.

WHY IT MATTERS

Expensive oil raises gasoline, transportation, and production costs. To curb those prices, the Fed and the Bank of Japan may raise interest rates. This reduces the current value of future earnings and first pressures technology, chips, and data centers.

AND FOR YOUR PORTFOLIO

For a long-term portfolio, this shows why technology stocks can move significantly even as their businesses continue to grow. A fund with these companies would have lost about $193 for every $10,000 invested that Friday.