Tokyo stocks gave up early gains to plunge into negative terrain Monday, pushed down by slumps in overseas markets.
The 225-issue Nikkei average shed 121.07 points, or 0.42%, to finish at 28,743.25, extending its losing streak to a third market day. On Friday, the key index lost 65.79 points.
The Topix index of all first section issues closed 2.60 points, or 0.14%, lower at 1,839.58, against an 11.44-point gain the previous trading day.
Investors rushed to buy right after the opening bell.
Repurchasing and “buying the dip” activities were invigorated by rebounds in all three major U.S. stock market gauges, including the Dow Jones Industrial Average, on Friday, which came in response to stronger-than-expected U.S. government employment data for February, brokers said.
After the bout of buying ran its course, however, both the Nikkei and Topix indexes turned to head south and sank into negative territory in the afternoon, with buying sentiment shrinking in the wake of falls in Dow futures in off-hours trading and in Chinese stock markets, brokers said.
Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., said that the early morning rally was also supported by the lingering effects of a fall in the benchmark U.S. long-term interest rate on Friday.
“But investors became increasingly worried about a possible sell-off in the U.S. market, as suggested by Dow futures,” he noted.
“Investors have been trading cautiously in view of the sharp market retreat since the Nikkei’s failure to remain above the 30,000 line,” a midsize securities firm official said.
On the first section, gainers outnumbered decliners 1,211 to 889 despite the price indicators’ drops, while 94 issues were flat. Volume increased to 1.511 billion shares from Friday’s 1.430 billion shares.
Clothing store operator Fast Retailing, chipmaking gear-maker Tokyo Electron and some other heavyweight Nikkei components came under heavy profit-taking pressure.
Glasses retailer Jins fell 3.16% despite its bullish sales in February.
Among other major losers were technology and entertainment giant Sony and system integrator NTT Data.
On the other hand, oil name Inpex rose for the fourth consecutive session, thanks to higher crude oil prices.
Takeda climbed 3.91%, after the drugmaker applied for Japanese health ministry approval for U.S. partner Moderna Inc.’s novel coronavirus vaccine.
Hitachi Construction Machinery and automaker Honda also rose.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average stood unchanged at 28,760.
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