Business / Financial Markets | TSE DATA & REPORT

Tokyo stocks narrow losses after precipitous fall

JIJI

Stocks failed to snap their losing streak Tuesday, although they recouped much of the big loss they suffered in early trading in the wake of a Wall Street sell-off.

The Nikkei 225 average fell 134.98 points, or 0.65 percent, to end at 20,585.31 after tumbling 366.87 points on Monday.

The Topix, which covers all first-section issues on the Tokyo Stock Exchange, closed 6.65 points, or 0.44 percent, lower at 1,499.23. It lost 27.58 points Monday.

The market suffered a precipitous fall right after the opening bell, with the Nikkei losing over 600 points as investors rushed to sell a broad range of issues in view of the Dow Jones Industrial Average closing 767.27 points lower Monday to mark the steepest closing point loss so far this year.

The U.S. government’s designation of China as a “currency manipulator” and Chinese firms’ halt in purchasing U.S. farm goods threw cold water over already shrunken investor sentiment amid the trade conflict between the two economic superpowers, brokers said.

But after the initial wave of selling, both the Nikkei and Topix bounced back.

The yen’s quick weakening against the dollar, the U.S. stock index futures market’s recovery in off-hours trading and speculation about Bank of Japan purchases of exchange-traded funds prompted investors to buy back shares, brokers said.

China allowed its currency yuan to fall to a decade low below the psychologically important level of 7 to the dollar Monday, in an retaliation against U.S. President Donald Trump’s threat to impose additional tariffs on $300 billion of Chinese goods.

But the yuan’s reference rate set against the dollar by the People’s Bank of China on Tuesday was “not as low as market players had feared and resulted in the dollar’s rebound against the yen and Dow futures’ recovery,” said Hiroaki Kuramochi, chief market analyst at Capital Partners Securities Co.

Falling issues outnumbered rising ones 1,291 to 766 in the first section, while 92 issues were unchanged.

Volume increased to 1.523 billion shares from 1.474 billion Monday.

Oil names, including Idemitsu and JXTG, met with selling due to a drop in crude oil prices.

Shipbuilder Hitachi Zosen plunged 6.42 percent after announcing weak earnings for April-September.

SoftBank Group and clothing store chain Fast Retailing fell.

By contrast, apparel firm World shot up 10.98 percent on a better than expected operating profit for April-June.

Also on the positive side were automaker Subaru and industrial robot producer Yaskawa Electric.