Tokyo stocks ended lower Tuesday after struggling for direction, with investors taking heart from some positive news but failing to shift their vigilant eyes from the coronavirus pandemic.
The Nikkei 225 average closed 167.96 points, or 0.88 percent, lower at 18,917.01. On Monday, it plunged 304.46 points.
The Topix, which covers all issues on the first section of the Tokyo Stock Exchange, dropped 32.50 points, or 2.26 percent, to 1,403.04 after falling 23.95 points Monday.
Encouraged by Monday’s Wall Street rally on hopes for the development of a vaccine for the novel coronavirus, the Tokyo market got off to a firmer start.
The Nikkei climbed until midmorning as investors moved to buy major component issues in the wake of the Chinese government’s release of the manufacturing purchasing managers’ index for March, which showed a sharp recovery in business sentiment among coronavirus-battered producers in the world’s second-largest economy, brokers said.
But after the buying lost steam, the key index repeated minor fluctuations for the rest of the morning session. Meanwhile, the Topix searched for direction throughout the morning.
Both indexes fell into negative territory in the afternoon, with concerns over the global virus crisis grew stronger again.
“The Nikkei was lifted in the morning by purchases of stocks in the semiconductor sector,” said Maki Sawada, vice president of Nomura Securities Co.’s investment research and investor services department.
Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co., noted that “in the afternoon, more and more investors turned concerned eyes on the possibility of the Japanese government declaring a state of emergency shortly.”
He added that players found it inadvisable to judge only from the latest manufacturing PMI reading that economic activities in China have recovered.
As long as the impact of the coronavirus outbreak on corporate earnings remains murky, investors cannot sustain active buying, Nomura’s Sawada added.
On the first section, falling issues far outnumbered rising ones 1,581 to 546 while 39 issues were unchanged. Volume fell to 1.862 billion shares from 1.924 billion Monday.
Shimamura tumbled 9.07 percent after the clothing retail chain said it cannot show earnings forecasts for the next business year due to difficulty measuring the effects of the virus crisis.
Karaoke machine maker Daiichikosho fell 3.68 percent, following Tokyo Gov. Yuriko Koike’s stay-at-home request to prevent the further transmission of the deadly virus.
Automaker Toyota and realtor Sumitomo Realty & Development were also sold.
On the other hand, Fujifilm Holdings rose 2.24 percent thanks to a news report that the technology firm will start a clinical trial to see the efficacy of its Avigan influenza drug in treating coronavirus patients.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.