An inverse-leveraged exchange-traded fund tracking the Nikkei 225 has posted significant gains during the morning trading session.

The CSOP Nikkei 225 Daily (-2x) Inverse Product (HKEX: 07515) was up more than 6%, rising 6.71% to HK$14.64 by the time of reporting, with a turnover of HK$4.762 million.

This movement follows a sharp decline in the underlying Nikkei 225 index, which fell over 4% on Friday, breaking below the 64,000-point mark. The index has now retreated more than 10% from its recent peak.

The downturn was heavily influenced by steep losses in four of the index's highest-weighted constituents, which collectively dragged the index down by approximately 1,590 points.

Among them, Japanese chipmaker Kioxia Holdings Corp saw its shares plummet by as much as 14%, marking a 51% decline from its high last month.

Other major contributors to the index's fall included Advantest Corp, Tokyo Electron Ltd, and SoftBank Group Corp.

The market sentiment has been impacted by several factors, including profit-taking pressure following a substantial rally in technology stocks.

Additionally, a renewed escalation in Middle East geopolitical tensions and rising oil prices have weighed on investor confidence.

Market attention is also focused on the future interest rate trajectory of the Bank of Japan, as rising inflation pressures bring the central bank's next policy moves into sharp relief.

This comes amid recent statements from several senior Japanese officials reaffirming the central bank's independence around July 11th.