Tokyo: Shares snap 3-day rally as sanctions on Russia hit sentiment

[TOKYO] Japanese shares snapped a 3-session rally to end lower on Wednesday (Mar 2), as growing concerns about the impact of sanctions by Western nations against Russia for invading Ukraine, pushed investors away from riskier assets towards safe-haven bets.

The Nikkei share average fell 1.68 per cent to 26,393.03, while the broader Topix slipped 1.96 per cent to 1,859.94.

"Geopolitical risks remain as the main factor to move markets. After sanctions were imposed in Russia, investors fled from equities to buy debt," said Shuji Hosoi, a senior strategist at Daiwa Securities.

Global sanctions against Russia have prompted a string of major companies to announce suspensions to or exits from their businesses in the country.

Exxon Mobil said it would exit Russian operations, including oil production fields, following similar decisions by British oil giants BP and Shell, and Norway's Equinor.

In Tokyo, technology heavyweights were the biggest drag on Nikkei, with chip-making equipment maker Tokyo Electron losing 1.99 per cent, robot maker Fanuc falling 3.64 per cent and air conditioner maker Daikin Industries losing 3.75 per cent.

Insurers were one of the worst performers among the Tokyo Stock Exchange's 33 industry subindexes, falling 4.08 per cent, as US Treasury yields dropped to 8-week lows overnight.

Yields on Japan's 10-year bonds also fell to its lowest since Jan 26.

T&D Holdings slid 6.31 per cent and Dai-ichi Life Holdings lost 5.21 per cent.

Oil explorers jumped 7.06 per cent after oil shot back above US$100 a barrel.

Orix snapped small gains to inch down 0.26 per cent after Nikkei, the publisher of the stock average, said it will add the financial services firm to the benchmark from next month, replacing Shinsei Bank. Shinsei Bank fell 3.23 per cent. REUTERS