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Tokyo: Shares close lower as trade fears linger
[TOKYO] Tokyo stocks closed lower on Monday, with investors wary about renewed trade tensions between the United States and China after talks failed to achieve a deal.
The benchmark Nikkei 225 index lost 0.72 per cent or 153.64 points to end at 21,191.28, while the broader Topix index was down 0.53 per cent or 8.28 points at 1,541.14.
US President Donald Trump on Sunday defended his tariff policy, insisting again that China will pay billions in duties to the US, after Trump's economic adviser raised eyebrows by saying both sides will suffer.
"We are right where we want to be with China," Mr Trump said on Twitter.
"Remember, they broke the deal with us & tried to renegotiate. We will be taking in Tens of Billions of Dollars in Tariffs from China."
Mr Trump had accused Beijing of reneging on its commitments in trade talks and ordered new punitive duties, which took effect Friday, on US$200 billion worth of Chinese imports, raising them to 25 per cent from 10 per cent.
He then ordered a tariff hike on almost all remaining imports from China, which are worth about US$300 billion, according to US Trade Representative Robert Lighthizer.
China responded that it would be forced to retaliate, without specifying how.
"The US-China talks are continuing without breakoff but it is difficult to see a deal being struck in the short term," Masayuki Kubota, chief strategist at Rakuten Securities, said in a commentary.
"If the US and China keep increasing tariffs, it is likely to have a negative impact on the global economy," he said.
"The Nikkei index is likely to be affected by the trade fears."
Investors are also watching a series of Chinese and US data due on Wednesday, including Chinese retail sales in April.
The dollar fetched 109.70 yen in Asian trade, against 109.96 yen in New York on Friday.
In Tokyo, China-related shares were lower, with electronic parts maker Rohm dropping 4.37 per cent to 7,220 yen and construction machine maker Komatsu down 1.92 per cent to 2,374 yen.
Toshiba fell 0.69 per cent to 3,580 yen after the company said its net profit jumped 26.0 per cent to 1.01 trillion yen but operating profit plunged 58.9 per cent. Panasonic fell 2.58 per cent to 892 yen while Sony lost 0.68 per cent to 5,371 yen.
SoftBank Group was up 0.98 per cent to 1,438 yen after a report that its SoftBank Vision Fund is injecting US$800 million into UK fintech Greensill.