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Tokyo: Nikkei tumbles on growing virus concern

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[TOKYO] Tokyo stocks tumbled more than 4 per cent on Wednesday, in line with an Asia-wide selloff fuelled by concerns over the coronavirus outbreak, while fears are also growing of a possible lockdown in the capital.

The Nikkei 225 index lost 4.50 per cent, or 851.60 points, to close at 18,065.41, marking a third straight drop, while the broader Topix index sank 3.70 per cent, or 51.96 points, to 1,351.08.

Traders were given a negative lead from Wall Street, where the Dow dropped almost 2 per cent, reflecting the economic hit from unprecedented government actions to shut down activity.

The Dow lost more than 23 per cent for the quarter, its worst since 1987, as the US shut down major parts of its economy in response to the pandemic.

Market sentiment in Tokyo also suffered from a key survey released early on Wednesday showing confidence among Japan's biggest manufacturers had plunged into negative territory for the first time in seven years, as demand and production are battered.

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The Bank of Japan's March Tankan business survey - a quarterly poll of about 10,000 companies - showed a reading of minus-eight among major manufacturers, the first negative reading since March 2013.

"I'm afraid the next Tankan will be worse than this time," Shinichi Yamamoto, a broker at Okasan Securities in Tokyo, told AFP.

The market faced additional selling pressure in late trade after US stock index futures dropped while investors remained nervous about a possible Tokyo lockdown, brokers said.

"If a lockdown is announced, it's going to have a considerable impact on the market," Mr Yamamoto said. "Players are nervously watching every day's infection figures in Tokyo," he added.

The US dollar traded at 107.41 yen in Asian afternoon trade, against 107.63 yen in New York.

Fujifilm edged down 0.03 per cent to 5,437 yen on profit-taking after rising in recent trading on expectations that its anti-flu medicine Avigan will be approved as a treatment for the coronavirus.

Carmakers were lower with Honda falling 5.49 per cent to 2,296.5 yen and Toyota shedding 2.61 per cent to 6,331 yen.

Subaru dropped 2.89 per cent to 2,013.5 yen after it announced it would halt its plants in Japan and the US for about 20 days.

AFP

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