Stocks snapped their three-session rising streak on the Tokyo Stock Exchange Wednesday, battered by fallbacks in U.S. and European equities.
The 225-issue Nikkei average dropped 58.65 points, or 0.28 percent, to end at 20,618.57. On Tuesday, the key market gauge surged 114.06 points.
The Topix index of all first-section issues finished down 9.26 points, or 0.61 percent, at 1,497.51 after advancing 12.44 points the previous day.
Stocks dived immediately after the opening bell under heavy profit-taking pressure built up by overnight downturns on Wall Street and in European markets, where concerns over geopolitical risks grew after Italian Prime Minister Giuseppe Conte resigned, brokers said.
After the initial bout of sell orders was executed, the Tokyo market demonstrated some resilience by attracting buybacks and bargain-hunting, they added.
But both the Nikkei and Topix indexes failed to rebound throughout the day as powerful buying incentives eluded.
Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co., pointed out that the market was “weighed down by concerns over the U.S.-China trade talks” after U.S. President Donald Trump reiterated at a news conference Tuesday that he is “not ready to make a deal.”
Meanwhile, Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc., said sentiment was underpinned by a rise in Dow Jones futures in off-hours trading.
Stocks resisted falling further after the initial tumble thanks again to buying “in anticipation of the Bank of Japan’s purchases of exchange-traded funds,” Yutaka Miura, senior technical analyst at Mizuho Securities Co., said.
Falling issues outnumbered rising ones 1,704 to 384 on the TSE’s first section, while 61 issues were unchanged.
Volume fell to 901 million shares from Tuesday’s 924 million.
Chemicals fared poorly as did their peers on the New York Stock Exchange Tuesday. Of them, Mitsubishi Gas Chemical sank 2.74 percent and Mitsui Chemicals 1.25 percent.
A drop in U.S. long-term interest rates prompted selling of mega-banks, with Mitsubishi UFJ sinking 1.05 percent and Mizuho 1.09 percent.
Among other losers were soy sauce maker Kikkoman and optical equipment maker Olympus.
On the other hand, industrial robot manufacturer Fanuc attracted buying, extending its winning streak to a third session.
Among other gainers were clothing store chain Fast Retailing and tire maker Bridgestone.
In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average fell 90 points to 20,570.