Business / Financial Markets | TSE DATA & REPORT

Nikkei continues to fall on weak U.S. equities

JIJI

The benchmark Nikkei average lost further ground on the Tokyo Stock Exchange on Friday, with investor sentiment dampened by a continued fall in U.S. shares overnight amid growing concerns over the global economy and the U.S.-China trade war.

The key 225-issue Nikkei average dropped 33.92 points, or 0.16 percent, to end at 21,117.22, after tumbling 132.23 points on Thursday.

On the other hand, the Topix index of all first-section issues finished up 0.63 point, or 0.04 percent, at 1,541.21, rising for the first time in four days. It fell 5.63 points on Thursday.

The Nikkei average opened below 21,000, falling past the line for the first time since May 16 on an intraday basis, due to the yen’s firming and the poor performance Thursday of U.S. equities, brokers said.

The Wall Street drop reflected lower-than-expected readings for the May manufacturing purchasing managers indexes for Germany, the eurozone and the United States, announced by IHS Markit on Thursday, brokers said.

The U.S. and Japanese stock markets remained under pressure from the trade conflict between the United States and China, the world’s biggest and second-biggest economies, they said.

Soon after the dismal start, the Nikkei lost as much as about 230 points. The index gradually cut its losses and retook 21,000 later, partly thanks to buying on dips, but stayed below the previous day’s closing level throughout Friday’s trading.

Yutaka Miura, senior technical analyst at Mizuho Securities Co., said that the Tokyo market’s downside was underpinned by buybacks induced by remarks by U.S. President Donald Trump on Thursday.

Trump reportedly said that major Chinese telecommunications equipment-maker Huawei Technologies, which is at the center of the U.S.-China tensions, may be included in a possible trade deal between the two countries.

Still, Miura noted that the market lacked vigor as investors came to think that Trump’s view is a little too optimistic.

Rising issues outnumbered falling ones 1,180 to 867 on the TSE’s first section, while 94 issues were unchanged.

Volume increased to 1.25 billion shares from Thursday’s 1.16 billion shares.

Oil companies, including JXTG, Inpex and Cosmo Energy, met with selling after key New York crude oil futures fell to the lowest level since mid-March on Thursday.

Industrial robot producer Fanuc and chipmaking equipment-maker Tokyo Electron were also downbeat.

Mobile game app developer DeNA surged 4.75 percent in line with investors’ moves to buy domestic demand-related stocks.

Among other winners were apartment rental firm Leopalace21 and Morinaga Milk Industry.

In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average was unchanged at 21,100.