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Nikkei edges down to 22,192 on receding U.S.-China trade worries

JIJI

The key Nikkei average closed marginally lower Thursday after cutting most of its early loss thanks to receding worries about U.S.-China trade friction.

The 225-issue Nikkei fell 12.18 points, or 0.05 percent, to end at 22,192.04 on the Tokyo Stock Exchange. On Wednesday, it lost 151.86 points.

The Topix index of all first-section issues finished down 10.88 points, or 0.64 percent, at 1,687.15, after sagging 12.92 points the previous day.

The Nikkei opened weaker and soon lost as much as 332 points on selling spurred by the yen’s strengthening against the dollar and Wall Street’s downturn on Wednesday.

But the market showed resilience, sending the Nikkei into positive territory in late morning trading, as worries over U.S.-China trade friction eased after China’s Commerce Ministry announced that a delegation led by Vice Commerce Minister Wang Shouwen would visit the United States later this month for discussions on trade issues, market sources said.

After ending the morning session with a moderate gain, however, the Nikkei fell back again in the absence of fresh, positive incentives and stayed in negative territory for most of the afternoon session.

The Topix moved on a weak note throughout Thursday’s trading.

Chihiro Ota, general manager for investment research and investor services at SMBC Nikko Securities Inc., said the market trimmed its initial losses thanks to futures-led purchases inspired by the yen’s moderate decline on news of the Chinese trade mission.

Clothing retailer Fast Retailing and other heavyweight components of the Nikkei average benefitted from that buying, said Yutaka Miura, senior technical analyst at Mizuho Securities Co.

Miura also said the market attracted buybacks and buying on dips.

Still, some are cautious about the outlook for trading. “The market is bearish, with its topside heavy,” an official of a major securities firm said.

Falling issues far outnumbered rising ones 1,673 to 367 on the TSE’s first section, while 64 issues were unchanged.

Volume rose to 1.546 billion shares from Wednesday’s 1.244 billion shares.

Sony, Murata Manufacturing and other high-tech names were downbeat, after the tech-heavy U.S. Nasdaq composite index dropped on Wednesday.

Kobe Steel closed down 2.33 percent as JPMorgan Securities Japan has lowered its investment rating and target price for the company.

Department stores Takashimaya, J.Front Retailing and Matsuya lost ground after releasing weak sales data for July on Wednesday. Selling pressure on the companies was compounded by an announcement by the Japan National Tourism Organization on Wednesday that said year-on-year growth in foreign visitors to Japan slowed to 5.6 percent in July from 15.3 percent in June, brokers said.

Other major losers included cosmetics maker Shiseido and mobile phone carriers KDDI and SoftBank Group.

By contrast, online game provider Nexon rebounded after plunging the previous day.

Also on the plus side were Japan Tobacco and drugmaker Takeda.

In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average fell 20 points to 22,160.