Tokyo stocks fell Thursday, with both the Nikkei and Topix closing at three-week lows, as weak U.S. employment data hurt investor sentiment while a stronger yen weighed on exporter issues.
The 225-issue Nikkei average ended down 436.87 points, or 2.01 percent, from Wednesday at 21,341.74. The broader Topix index of all first section issues on the Tokyo Stock Exchange finished 27.42 points, or 1.72 percent, lower at 1,568.87.
All industrial categories lost ground, with decliners led by mining, farm and fishery, and transportation equipment issues.
Shares remained under selling pressure throughout the day, with the Nikkei briefly losing more than 500 points, or 2.30 percent, before ending at its lowest level since Sept. 9. The Topix closed at its lowest since Sept. 10.
The ADP National Employment report revealed Wednesday that an increase in the number of nonfarm employees in the U.S. private sector was weaker than market expectations for September. Additionally, August’s figure was adjusted lower than originally reported.
The report, which came before more comprehensive nonfarm payrolls data is released by the government Friday, added to investor concerns about the health of the U.S. economy, brokers said. It was revealed the previous day that the country’s key manufacturing activity index dropped last month to its lowest level in more than a decade.
The ADP report “came as a negative surprise to investors because other indicators released earlier had pointed to the country enjoying solid employment and consumption despite the U.S.-China tariff war,” said Akira Tanoue of Nomura Securities Co.’s investment research and investor services department.
Trading became slower in the afternoon as a wait-and-see mood spread among market participants awaiting a key U.S. service sector index due out later in the day.
“Investors are paying close attention to the index to gauge the seriousness of the damage from the U.S.-China trade row on the U.S. economy,” said Yutaka Miura, senior technical analyst at Mizuho Securities Co.
On the first section, declining issues outnumbered advancers 1,963 to 159, while 29 ended unchanged.
Automakers were among the hardest hit, with Suzuki Motor Co. falling by ¥182, or 4.0 percent, to ¥4,403, Mitsubishi Motors Corp. sliding ¥13, or 2.7 percent, to ¥467, and Toyota Motor Corp. sinking ¥177, or 2.5 percent, to ¥6,982.
The sharp appreciation of the yen overnight also weighed on major exporters.
Tokai Carbon Co., a supplier of black carbon used in tires, contracted ¥31, or 2.8 percent, to ¥1,068. Synthetic fiber-maker Teijin declined ¥54, or 2.6 percent, to ¥2,048 while electronic component manufacturer Kyocera Corp. went down ¥173, or 2.6 percent, to ¥6,546.
Trading volume on the main section rose to 1.22381 billion shares from Wednesday’s 1.17164 billion shares.