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Tokyo: Nikkei drops on fears government will proceed with sales tax hike
[TOKYO] Japanese stocks fell on Monday on fears that the government will proceed with its plan to raise the sales tax next April, risking a further blow to the sluggish economy.
The Nikkei share average slipped 0.5 per cent to end at 16,654.60 points, after dropping more than one per cent at one point.
Japanese finance minister Taro Aso said he told US Treasury Secretary Jack Lew that Japan will proceed with an April sales tax hike that market participants have long expected would be delayed.
The reports added to concerns over Japan's weak consumer sentiment, while the profit outlook for exporters' shares also suffered as the yen strengthened against the US dollar due in part to Japan's much larger-than-expected trade surplus in April.
Home appliances and electronics exporter Panasonic Corp edged down 0.3 per cent while auto exporter Toyota Motor Corp ended the day one per cent lower.
The broader Topix fell 0.4 per cent to end at 1,338.68 with all but 10 of its 33 subindexes in negative territory.
The JPX-Nikkei Index 400 declined 0.4 per cent to 12,090.65.