Business / Financial Markets | TSE DATA & REPORT

Tokyo stocks plunge further amid U.S.-China trade war fears

JIJI

Stocks sank deeper across the board on the Tokyo Stock Exchange Wednesday, as heightened trade tensions between the United States and China continued to chill investor sentiment.

The 225-issue Nikkei average dived 321.13 points, or 1.46 percent, to end at 21,602.59, a level unseen since April 2 on a closing basis. On Tuesday, the key market gauge tumbled 335.01 points.

The TOPIX index of all first-section issues was down 27.51 points, or 1.72 percent, at 1,572.33, after losing 18.09 points the previous day.

The market opened sharply lower, tracking a Wall Street tumble Tuesday that came after U.S. Trade Representative Robert Lighthizer reaffirmed plans to raise tariffs on Chinese goods worth $200 billion from 10 percent to 25 percent. In his Twitter posting on Sunday, U.S. President Donald Trump threatened to impose the additional tariffs.

Both Nikkei and TOPIX stayed deep in negative territory for the rest of the session, also pressured by the yen’s strengthening against the dollar, brokers said.

The United States and China are expected to resume their ministerial-level trade talks in Washington on Thursday, the day before the proposed tariff hike.

“A risk-off mood will likely prevail at least until Friday” to see what will happen in the trade negotiations, said Hiroaki Kuramochi, chief market analyst at Saxo Bank Securities Ltd.

Yutaka Miura, senior technical analyst at Mizuho Securities Co., also attributed the Tokyo market sell-off to the dollar’s plunge below ¥110.

Depending on developments related to the U.S.-China trade dispute, the Nikkei may fall as low as its 75-day moving average of around 21,350 in the near term, an official at a major securities firm said.

Falling issues far outnumbered rising ones 1,804 to 287 in the TSE’s first section, while 49 issues were unchanged.

Volume decreased to 1,496 million shares from Tuesday’s 1,564 million shares.

Export-oriented and cyclical issues, in particular, met with heavy selling. Such losers included industrial robot producer Fanuc and chipmaking gear manufacturer Tokyo Electron.

JAL was dumped due to an automated check-in system glitch that caused 32 domestic flight cancellations at airports across Japan on Wednesday.

Motorcycle manufacturer Yamaha Motor dived as its consolidated operating profit in January-March failed to beat a market consensus.

Daily goods supplier Kao and drug maker Takeda also took precipitous falls.

Meanwhile, clothing store chain Fast Retailing and job information service firm Recruit Holdings were among a handful of winners.

In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average fell 360 points to end at 21,580.