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Tokyo stocks plummeted Thursday on the heels of an overnight Wall Street fall, causing the benchmark Nikkei average to end below the psychologically important threshold of 29,000.

The 225-issue Nikkei average lost 628.99 points, or 2.13%, to finish at 28,930.11, closing below the 29,000 line for the first time since Friday. On Wednesday, the key index gained 150.93 points.

The Topix index of all first section issues closed 19.80 points, or 1.04%, lower at 1,884.74, following a 9.69-point advance the previous day.

The Tokyo market suffered a weak start, reflecting investors’ dismay over drops in all three major U.S. stock market gauges, including the Nasdaq composite index, on Wednesday following a rise in U.S. long-term interest rates.

Technology-oriented Tokyo stocks, in particular, suffered heavy blows from sharp falls in the tech-heavy Nasdaq and SOX Philadelphia semiconductor indexes, brokers said.

While stable moves of the dollar-yen pair and buybacks helped the market show some resilience later in the morning, the market dived deeper into negative territory in the afternoon, with the Nikkei shedding over 800 points at one point.

The afternoon’s tumble came in response to falls in Chinese stock markets and the U.S. Dow Jones Industrial Average futures in off-hours trading, the brokers said.

“Investors feared that the U.S. market may suffer another fall later on Thursday, as suggested by the sluggish performance of Dow futures,” said Yutaka Miura, senior technical analyst at Mizuho Securities Co.

Another bank-affiliated securities firm official observed, “Foreign investment funds, which had been the main driving force behind the stock market’s recent climb, moved to dump stocks.”

“It is hard to predict how far the Tokyo market could fall from here,” an official at an asset management firm said, noting that short-term players are stepping up profit-taking and long-term investors are selling out of fears of a further climb in U.S. long-term interest rates.

In the TSE first section, losers overwhelmed gainers 1,295 to 787 while 112 issues stayed unchanged. Volume increased slightly to 1.285 billion shares from Wednesday’s 1.206 billion shares.

Of high-tech issues, those in the semiconductor business were hit especially hard by selling, with chip testing device manufacturer Advantest plummeting 2.69% and chipmaking gear-maker Tokyo Electron diving 2.43%.

SoftBank Group sank 5.19%, partly reflecting news reports that British financial services company Greensill Capital, backed by the Japanese technology investor, is preparing to file for insolvency.

Among other major losers were clothing store chain Fast Retailing and job information service provider Recruit Holdings.

On the other hand, Hitachi Zosen went limit-up, buoyed by a media report that the heavy machinery-maker has unveiled an all-solid-state battery boasting seven times the capacity of its prior models.

Nippon Yusen rose 2.76%, thanks to Nomura Securities Co. revising up its target price for the shipping firm.

In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average tumbled 610 points to end at 28,980.

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