The reduction of the balance sheet by the Bank of Japan brings liquidity shock and poses a headwind challenge to the Japanese stock market.

Wisdom Financial News APP learned that the Bank of Japan is cautiously fine-tuning its strategy of withdrawing from the bond market, but the fact is that quantitative tightening measures are already being implemented, which may lead to instability in some stocks. The potential impact of quantitative tightening policies could cast a shadow over further gains in the Nikkei 225 index, as the index has already hit a four-month high this week. The blue-chip stock index is mainly composed of growth stocks, such as Fast Retailing, the parent company of Uniqlo, as well as chip-related companies Advantest and Tokyo Electron.