Tokyo stocks declined Wednesday following an overnight plunge in U.S. equities.
The 225-issue Nikkei average fell 131.40 points, or 0.61 percent to end at 21,456.38. On Tuesday, the key market gauge rose 212.53 points.
The TOPIX index of all issues listed on the first section of the Tokyo Stock Exchange finished down 4.80 points, or 0.30 percent, at 1,581.70, after gaining 13.75 points the previous day.
The Tokyo market nosedived immediately after its opening with the benchmark Nikkei average losing more than 200 points, in the wake of the Dow Jones industrial average expanding losses by 313 points in its two-day losing streak on the New York Stock Exchange Tuesday.
Investors grew more concerned about the possibility of trade talks between the United States and China from Thursday producing no major fruit, after the administration of U.S. President Donald Trump decided on sanctions against 28 Chinese entities for human rights abuse in the Xinjiang Uighur Autonomous Region and visa restrictions on Chinese officials implicated in Uighur suppression, brokers said.
Following the opening tumble, market activities subsided due to a dearth of fresh trading incentives, with both the Nikkei and TOPIX indexes moving narrowly in negative territory for the rest of the session.
A media report about the Trump administration’s discussions on ways to limit government pension funds’ investment in China fueled concerns over U.S.-China ties, Hiroaki Kuramochi, chief market analyst at Capital Partners Securities Co., said.
With the U.S. economy showing signs of a downturn, the global economic outlook is becoming foggy, resulting in sluggish stock trading, an official at a midsize securities firm said.
Despite the dismal readings of the market indicators, however, rising issues outnumbered falling ones 1,070 to 982 on the first section, while 101 issues were unchanged.
Volume dropped to 1,045 million shares from Tuesday’s 1,113 million shares.
China-linked issues met with selling. They included industrial robot producers Yaskawa Electric and Fanuc, and construction machinery maker Komatsu.
Financials including megabank group Mitsubishi UFJ and insurer Dai-ichi Life fell following a drop in U.S. long-term interest rates.
Among other losers were mobile phone carrier KDDI and technology investor Softbank Group.
On the other hand, railway operators attracted purchases, with Keisei going up 1.25 percent and Tokyu 0.64 percent.
Also on the positive side were daily goods producer Kao and automaker Toyota.
In index futures trading on the Osaka Exchange, the key December contract on the Nikkei average fell 180 points to end at 21,440.