Tokyo: Nikkei recoups losses but stalled vaccine trials, stimulus talks weigh

[TOKYO] Japan's stock benchmark Nikkei recouped early losses on Wednesday to close marginally higher, but sentiment remained subdued over stalled Covid-19 vaccine trials and lack of agreement on additional US fiscal stimulus.

The benchmark Nikkei share average rose 0.11 per cent to 23,626.73, while the broader Topix lost 0.32 per cent to 1,643.90.

Tokyo shares followed Wall Street lower in early trade before reversing course in the afternoon, which analysts suspected was due to the Bank of Japan's exchange-traded fund buying.

On Tuesday, major indexes on Wall Street ended lower as Johnson & Johnson and Eli Lilly halted coronavirus vaccine and antibody treatment trials, respectively, over safety concerns, dampening investor sentiment.

Fading hopes for a new US coronavirus relief package also weighed on the market, as US House Speaker Nancy Pelosi rejected a US$1.8 trillion coronavirus relief proposal from the White House.

Back home, Apple-related issues underperformed on profit-taking and dented by a 2.7 per cent fall in Apple shares following an event where the company unveiled its latest iPhone.

TDK edged 0.08 per cent lower, while Taiyo Yuden fell 0.27 per cent.

Financial shares also took a hit from a weak performance in their US peers, with Sumitomo Mitsui Financial Group dropping 1.71 per cent and Mitsubishi UFJ Financial Group down 1.01 per cent.

Meanwhile, semiconductors performed strongly, with Tokyo Electron rising about 2.6 per cent and Lasertec up 0.1 per cent.

"The moves are quite subtle when only looking at the Nikkei share average. But the Mothers Index is renewing highs and semiconductor stocks are still strongly sought after," said Takashi Hiroki, chief strategist at Monex Securities.

The Mothers Index of startup firms gained 1.37 per cent, posting its highest close since January 2018.

Elsewhere, ANA Holdings dipped 4.59 per cent after reports that the company was going to cut monthly wages for all workers by 5 per cent.

Nippon Steel lost 3.82 per cent on news that the company would sell two US plants as it speeds up a reorganisation in overseas operations.

REUTERS