You are here
Tokyo: Stocks close lower amid trade worries
[TOKYO] Tokyo stocks closed lower on Wednesday with worries growing again over trade as the United States and China show few signs of progress on their dispute.
The benchmark Nikkei 225 index lost 1.21 per cent or 256.77 points to 21,003.37, while the broader Topix Index ended the session down 0.94 per cent, or 14.59 points, at 1,536.41.
Falls in US Treasury bonds yields that sent global shares lower "are due to worries over an economic slowdown" because there are no signs of an early deal between the US and China on trade, Kyoko Amemiya, senior market adviser at SBI Securities, told AFP.
Economists estimate the US-China trade war will negatively impact the world's number one and number two economies and in turn the global economy, as the costs of punitive tariffs would have to be paid by consumers.
"Unless we see a trade deal, negative sentiment in the market will likely continue," Ms Amemiya said.
After sharp falls in early trade, some shares recovered thanks to bargain-hunting but "the pace of recovery is rather slow", Minami Koura, strategist at Daiwa Securities, said in a commentary.
The safe-haven yen edged higher against both the dollar and the euro in late Tokyo hours, with the dollar fetching 109.20 yen and the euro trading at 121.89 yen, against 109.48 yen and 122.26 yen in New York.
A higher yen weighs on Japanese exporters as it makes Japanese-made goods more expensive in overseas markets and shrinks their repatriated profits.
In Tokyo, some bluechip exporters lost ground, with Sony declining 2.63 per cent to 5,314 yen and chip-testing equipment maker Advantest dropping 3.98 per cent to 2,575 yen.
Banks were also lower, reflecting falls in US bond yields, with Mitsubishi UFJ Financial closing down 1.46 per cent at 505.5 yen, Mitsui Sumitomo Financial down 1.21 per cent at 3,819 yen and Mizuho off 1.27 per cent at 155.3 yen.