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Tokyo stocks close lower on trade worries
TOKYO, April 10, 2019 (BSS/AFP) – Tokyo stocks closed lower on Wednesday
amid a flare-up in trade tensions between the United States and Europe, with
investors eying a press conference by the European Central Bank president.
The benchmark Nikkei 225 index fell 0.53 percent or 115.02 points to end
at 21,687.57 while the broader Topix index was down 0.69 percent or 11.10
points at 1,607.66.
“On top of the US-China trade war, tensions between the United States and
Europe are escalating, spawning worries that the global economy may worsen
further,” Online Okasan Securities said in a note.
President Donald Trump on Tuesday lashed out at the EU, vowing to impose
tariffs on billions in imports, over subsidies to the aviation giant Airbus.
The International Monetary Fund cut its US growth forecast significantly
for 2019 though it said the United States is still likely to outpace other
advanced nations as the world economy slows.
The financial uncertainty underpinned the Japanese currency, with the
dollar trading at 111.17 yen against 111.15 yen in New York Tuesday
afternoon.
A higher yen is negative for Japanese exporters as it makes their products
less competitive abroad and erodes their profits when repatriated.
Traders were also eyeing a press conference by European Central Bank
President Mario Draghi to be held later in the day.
Nintendo fell 0.96 percent to 32,920 yen and Toyota lost 0.52 percent to
6,795 yen.
Japan Post tumbled 2.87 percent to 1,249 yen after news of a new share
sale by the government.
The finance ministry said late Tuesday it was preparing for a third sale
of shares in the giant postal group.
The Nikkei business daily reported Wednesday that the government was
planning the sale as early as autumn this year to raise around 1.3 trillion
yen ($11.7 billion).
The move would cut the ministry’s stake to the legally mandated minimum of
just over one-third from the current 57 percent, ending a privatisation
process that has lasted more than a decade, the paper said.
Sony dropped 2.45 percent to 5,121 yen a day after it surged more than
nine percent following a report that hedge fund Third Point is raising funds
to build up its stake in the Japanese electronics company.
BSS/AFP/HR/1318