Business / Financial Markets | CURRENCY MARKET

Nikkei briefly sinks over 500 points in early trading

JIJI

The benchmark Nikkei average briefly tumbled more than 500 points in early trading on the Tokyo Stock Exchange on Monday, battered by a plunge in U.S. equities late last week and a stronger yen.

At 9:03 a.m., the 225-issue Nikkei touched a low of 20,172.76, down 537.18 points, or 2.59 percent, from Friday’s closing.

Tokyo stocks skidded lower almost across the board, after the Dow Jones industrial average finished Friday’s trading with a loss of more than 600 points as U.S.-China trade tensions escalated. Beijing said it would slap retaliatory tariffs on $75 billion worth of U.S. goods, while U.S. President Donald Trump immediately vowed to fight back.

The Nikkei suffered a major setback after a two-session rise, also pressured by the yen’s strengthening against the dollar, with the Japanese currency attracting safe-haven buying amid worries that the worsening U.S.-China trade war may lead to a global economic slowdown, market players said.

In Tokyo currency trading, the dollar was quoted at ¥104.88-92 at 9 a.m., down sharply from ¥106.63-64 at 5 p.m. Friday.

Reflecting risk aversion among investors, Japanese government bonds attracted buying, with the benchmark 10-year JGB yield dropping to a three-year low of minus 0.265 percent in early trading on Monday.

The yield on the 355th issue of 10-year JGBs, with a coupon of plus 0.100 percent, fell 0.025 percentage point from late Friday to hit the lowest level since July 29, 2016.

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