Overseas investors dumped Japanese stock futures and cash equities at the fastest pace since November last week, according to Bloomberg Markets. The sell-off came as part of a broader risk-off move triggered by the outbreak of the Iran war, with global investors seeking safer assets amid heightened geopolitical tensions.

This marks the largest net foreign outflow from Japanese markets in months, suggesting growing unease about regional stability and its impact on Asian equities. The sell-off in Japanese stocks reflects a flight to safety as investors reassess exposure to markets perceived as vulnerable to Middle East conflict spillover.

Japanese equities, often seen as a proxy for global risk appetite, are now under pressure as foreign capital retreats. The timing is particularly notable given Japan's economic recovery and corporate earnings momentum, which had been attracting international investment. With tensions in the Middle East showing no signs of easing, further foreign selling could weigh on Japanese markets in the near term.