Tokyo stocks lost further ground Thursday in the wake of an overnight plunge on Wall Street.
The 225-issue Nikkei average listed on the first section of the Tokyo Stock Exchange lost 258.67 points, or 1.11 percent, to close at 23,087.82, after falling 13.81 points Wednesday.
The Topix index of all TSE first-section issues closed down 17.81 points, or 1.08 percent, at 1,626.44, after a 2.17-point drop the previous day.
Disheartened by falls in all three major U.S. stock price gauges Wednesday, investors moved to sell stocks from the opening bell of Thursday’s trading on the TSE.
The U.S. market tumble came as hopes for a recovery in the U.S. economy receded due to the lower-than-expected U.S. service sector purchasing managers index for September, released by British financial data provider IHS Markit, brokers said.
They also cited U.S. Federal Reserve Chairman Jerome Powell expressing concern over economic uncertainties amid the novel coronavirus crisis, and pointing to the need for a new stimulus package.
The Nikkei showed some resilience after sinking nearly 250 points shortly after the opening, but fell deeper into negative territory in the afternoon to temporarily shed over 300 points.
The dive came on the heels of falls in the Chinese stock market, as well as U.S. Dow Jones industrial average futures in off-hours trading, market sources said.
“Investor sentiment was hurt by stalled talks in the United States over a fresh coronavirus relief package,” Yutaka Miura, senior technical analyst at Mizuho Securities Co., noted.
Meanwhile, the Tokyo market’s resilience in early trading came on the back of expectations for purchases of exchange-traded funds by the Bank of Japan, he said.
On the TSE first section, falling issues overwhelmed rising ones 1,685 to 419, while 72 issues were unchanged.
First-section volume decreased to 1.25 billion shares from Wednesday’s 1.52 billion.
Automaker Toyota, electronic device maker Nidec and other export-oriented issues succumbed to heavy selling, reflecting uncertainties over the world economy amid growing novel coronavirus cases in Europe and the stalemated virus stimulus talks in the United States.
Job information provider Recruit Holdings and medical information company M3 were also out of favor.
On the other hand, clothing retailer Shimamura jumped 5.25 percent, thanks to its rosy preliminary sales data for September.
Among other major winners were food producer Meiji Holdings and parcel delivery firm Yamato Holdings.
In index futures trading on the Osaka Exchange, the key December contract on the Nikkei fell 270 points to 22,920.
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.