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Tokyo's Nikkei closes marginally higher

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[TOKYO] Tokyo's benchmark Nikkei index edged up on Wednesday as a weak yen prompted late bargain hunting, but investors remained concerned over a potential slowdown in the global economy.

The Nikkei 225 index rose 0.12 per cent, or 23.98 points, to close at 20,649.14, but the broader Topix index was down 0.26 per cent, or 3.98 points, at 1,506.81.

Tokyo stocks opened lower but recovered their early losses by the closing bell as investors welcomed a weak yen against the dollar, brokers said.

"There are many Japanese shares which are still undervalued," said Shinichi Yamamoto, broker at Okasan Securities in Tokyo.

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The dollar fell to 106.18 yen in Asian afternoon trade from 105.94 yen in New York.

But movement was limited by fears that the global economy may be slowing, after US data pointed to weakness in the manufacturing sector.

Wall Street stocks tumbled Tuesday as new tariffs in the US-China trade war took effect, while US data suggested weakness in the manufacturing sector.

Washington and Beijing imposed new levies on Sept 1, with the US now levelling 15 per cent tariffs on an assortment of consumer goods and China responding with its own duties.

Meanwhile, "against expectations for an unchanged outcome, the US ISM manufacturing index contracted in August clipping the wings of a rising US dollar, (and) also dragging equities," Rodrigo Catril, senior strategist at National Australia Bank, said in a note.

The direct impact of Britain's political confusion on the Japanese market appeared limited, Okasan's Mr Yamamoto said.

"But Japanese shares may be affected by US and European reactions to Britain's decision on Brexit," he said.

In Tokyo, Nintendo jumped 2.59 per cent to 41,580 yen as Sony gained 0.85 per cent to 6,150 yen.

But Nissan lost 1.73 per cent to 644.9 yen with Toyota down 0.69 per cent at 6,956 yen.

AFP