Tokyo: Nikkei closes lower on virus, profit-taking

[TOKYO] Tokyo's benchmark Nikkei index lost more than 1.5 per cent on Monday, as the spreading coronavirus prompted investors to cash in on recent gains with a higher yen also weighing on the market.

The Nikkei 225 index, which jumped nearly 4 per cent on Friday, fell 1.57 per cent, or 304.46 points, to close at 19,084.97 on Monday.

The broader Topix index dropped 1.64 per cent, or 23.95 points, to 1,435.54.

Tokyo stocks opened sharply lower, taking a negative lead from Wall Street, where shares plunged on Friday after three positive sessions despite the House of Representatives approving a US$2 trillion package to address the coronavirus crisis.

Selling was also driven by Monday's expiry of the right to receive company dividends, leading many investors to sell off their holdings, analysts said.

"Market sentiment remained weak during the day due to a strong yen, profit-taking and the expiration of the dividend right," Shinichi Yamamoto, a broker at Okasan Securities in Tokyo, told AFP.

The US dollar changed hands at 107.69 yen in Asian afternoon trade, down from 107.88 yen in New York on Friday and 110-yen levels seen early last week.

"Investors are nervously watching a possible lockdown in Tokyo, which will have a massive impact on the Japanese economy," Mr Yamamoto said.

Tokyo Governor Yuriko Koike urged residents to stay home during the weekend, warning of a possible "explosion" of the novel coronavirus in the capital.

Major shares were down across the board, with Toyota losing 3.30 per cent and Uniqlo casual wear operator Fast Retailing down 2.45 per cent.

Sony was down 3.79 per cent after it said the virus had hammered its music and entertainment venues, as well as sales of its electronic products.

Fujifilm bucked the trend, soaring 5.97 per cent amid reports the government will support research linked to its anti-flu medicine Avigan as a potential treatment for the coronavirus.

AFP