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Japan's Nikkei index drops 10 per cent

Fears of a meltdown at the Fukushima Daiichi plant cause shares to plummet.

The index has plunged 10.5 per cent, a change in value of 1015.34, as a result of uncertainty over the safety of the Fukushima Daiichi nuclear plant, which has reportedly sustained further explosions.

Fears of a meltdown are rife, and Japan is not the only one affected. European markets opened 1-2 per cent lower, Australian shares dropped by 2.1 per cent to a six-month low, and Taiwanese stocks fell 3.4 per cent, the largest drop for over a year.

The Japanese economy will also be hit by the rising price of the Yen, which is being bought back in large amounts to fund reconstruction projects. This will mean that exports will be more expensive to foreign buyers, and impair Japanese competition.

The future is bleak for Japan, whose national debt is currently at 196 per cent of its GDP, and will now also have to pay off around $180bn in reconstruction and recovery costs.

By Liam McLaughlin

Liam McLaughlin is a freelance journalist who has also written for Prospect and the Huffington Post. He tweets irregularly @LiamMc108.