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Tokyo’s Nikkei closes down 3.7% as global markets plunge
TOKYO, Oct 25, 2018 (BSS/AFP) – Tokyo’s Nikkei plunged more than 3.7
percent on Thursday, after a punishing session on Wall Street that saw major
US indices wipe out all their 2018 gains.
The benchmark Nikkei 225 index gave up 3.72 percent, or 822.45 points to
21,268.73, while the broader Topix index lost 3.10 percent, or 51.15 points,
to 1,600.92.
It was the worst close for the Nikkei in nearly seven months.
The index began the day under heavy selling pressure after the US plunges.
“A sense of uncertainty for the global economic outlook stoked worries
that the market rout (in New York) was going to affect Asia,” Okasan Online
Securities said in a note to clients.
Investors are facing the expectation of higher US interest rates, which
would boost borrowing costs, anxiety over the fallout from the murder of
Saudi journalist Jamal Khashoggi, and an ongoing budget dispute between Italy
and Brussels.
A US data report Wednesday showed home sales fell to their slowest pace in
nearly two years, while forecasts from big companies AT&T, UPS and Texas
Instruments disappointed.
Investors have grown wary that the US-China trade war is starting to weigh
on US corporate earnings.
“This mess of bad factors has made it difficult for markets to seize a
chance to turn up,” Makoto Sengoku, market analyst at Tokai Tokyo Research
Institute, told AFP.
Risk aversion spawned safe-haven buying of the yen, in a negative
development for Japanese exporters.
The dollar was changing hands at 112.01 yen against 112.19 yen in New York
Wednesday afternoon.
“The market was waiting for an opportunity for a technical rebound, but
investor sentiment has remained in deep freeze,” Okasan said.
“There was no visible move to sell down shares further. The market now
wants to see the direction of US shares tonight,” it added.
Among blue chip firms Toyota lost 2.68 percent to 6,402 yen, while Sony
plunged 5.46 percent to 5,869 yen.
Uniqlo-operator Fast Retailing fell 4.94 percent to 54,400 yen.
BSS/AFP/HR/1407