Stocks fell back steeply on the Tokyo Stock Exchange on Thursday amid increasing risk-averse sentiment, with the Nikkei average briefly tumbling below 17,000 for the first time in more than three months.
It reflected investor concerns over a further fall in crude oil prices and the course of the Japanese economy, brokers said.
The Nikkei lost 474.68 points, or 2.68 percent, to end at 17,240.95, after sinking below the 17,000 line for the first time since Sept. 29 with a loss of some 770 points. On Wednesday, it jumped 496.67 points for the first daily gain this year.
The Topix slumped 35.54 points, or 2.46 percent, to 1,406.55, following a rise of 40.14 points the previous day.
The Tokyo market was hit by heavy selling from the outset of Thursday’s trading after the Dow Jones Industrial Average fell sharply overnight, reflecting mounting worries about slumping crude oil prices.
A wide range of issues were battered, with market sentiment bruised further by machinery order figures for November that were worse than expected, released just before the opening bell, brokers said.
In the afternoon, the Nikkei average accelerated its downswing, affected by futures-led speculative selling. But stock prices trimmed losses in late trading as Shanghai equities popped up into positive territory, brokers said.
A risk-averse mood prevailed in financial markets, with the yield on the latest 10-year Japanese government bond issue marking a record low of 0.190 percent in the afternoon on the back of purchases by investors seeking a safe haven for their funds.
Investors started to believe it will take a long time before the drop of crude oil futures prices in New York comes to a halt and Chinese stocks regain strength, brokers said.
“The Nikkei’s downside for the time being would be around 16,500 if it slips below the intraday low of Sept. 29,” which stood at 16,901.49, said Hiroaki Hiwada, strategist at Toyo Securities Co.
But Hiwada also said, “Ahead of the end of this month and fiscal 2015, the market may be shored up by buying for high-yielding large-cap issues with special benefit programs for shareholders.”
Falling issues far outnumbered rising ones 1,795 to 104 in the TSE’s first section, while 36 issues were unchanged.
Volume increased to 2,600 million shares from Wednesday’s 2,139 million shares.
All 33 sector subindexes in the first section closed lower.
Trading house Sumitomo plunged 5.75 percent, a day after the company withdrew its group net profit forecast for the year to March 2016, citing possible impairment losses, brokers said. Rivals Mitsui, Mitsubishi and Itochu also slid lower.
Staffing agency Pasona Group plummeted 10.38 percent after its midterm operating profit announced Wednesday turned out weaker than the company’s plan, brokers said.
Automaker Toyota, mobile carriers Softbank and KDDI and robot maker Fanuc were downbeat.
On the other hand, Bic Camera surged 4.93 percent, a day after the consumer electronics retailer announced brisk earnings for September-November 2015.
A handful of other winners included precision equipment maker Nikon and device producer TDK.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average dived 390 points to end at 17,310.