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Tokyo's Nikkei index down more than 1.5%

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[TOKYO] Tokyo's benchmark Nikkei index lost more than 1.5 per cent on Monday as investors cashed in on gains made last week, and with trading remaining thin ahead of US mid-term elections.

The Nikkei 225 index, which jumped 5.0 per cent last week, fell 1.55 per cent or 344.67 points to close at 21,898.99 while the broader Topix index was down 1.11 per cent or 18.37 points at 1,640.39.

"Profit-taking spread in the market as players became cautious again" about the long-running US-China trade dispute, said Toshikazu Horiuchi, a broker at IwaiCosmo Securities.

On Friday, the Nikkei surged more than 2.5 per cent after US President Donald Trump hailed positive talks with Chinese President Xi Jinping and a report said he had asked officials to draw up a draft bill as he eyes a potential trade deal between the two.

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But on Monday, investors were cautious ahead of US mid-term elections, while worsening business confidence indicators from both China and the United States last week were also a concern, brokers said.

"Trading was thin as investors took to the sidelines ahead of the biggest market event of the week," Mr Horiuchi told AFP.

Investors were also cautious about ongoing corporate earnings reports.

"If there are no expectations for upward revisions in (full-year) earnings forecasts, foreign investors in Tokyo stocks need an improvement in external factors such as a rise in US shares and a cheaper yen," said Tsuyoshi Nomaguchi, strategist at Daiwa Securities.

The dollar fetched 113.27 yen in Asian trade, against 113.28 yen in New York on Friday.

In Tokyo, SoftBank rose 0.55 per cent to 8,747 yen. Just after the market closed, SoftBank said it logged an eight-fold jump in net profit in the six months to September.

Game giant Nintendo, which announced worse-than-expected earnings last week, lost 2.72 per cent to 34,990 yen.

Toyota was down 0.96 per cent at 6,494 yen. The car giant will announce first-half results on Tuesday.

AFP