Stocks extended their losses on the Tokyo Stock Exchange Wednesday, as investor sentiment was dampened by overnight drops in U.S. equities.
The 225-issue Nikkei average sank 107.22 points, or 0.51 percent, to end at 21,086.59. On Tuesday, the key market gauge shed 92.18 points.
The Topix index of all first-section issues closed down 9.15 points, or 0.59 percent, at 1,534.34, after losing 4.25 points the previous day.
The market opened sharply lower, after Wall Street took a downturn Tuesday following remarks by senior policymakers of the U.S. Federal Reserve suggesting the possibility of the Fed refraining from cutting interest rates by a big margin next month, brokers said.
But Tokyo stocks showed some resilience later in the morning, helped by a halt in the yen’s strengthening against the dollar.
In the afternoon, however, selling outpaced buying again as investors took to the sidelines ahead of a meeting between U.S. President Donald Trump and his Chinese counterpart, Xi Jinping, to be held on the sidelines of the two-day Group of 20 summit starting in Osaka Friday.
Moves to dump issues that went ex-dividend Wednesday also weighed on the market, brokers added.
U.S. stocks’ weakness was solely responsible for the Tokyo market’s plunge, Yoshihiko Tabei, chief analyst at Naito Securities Co., noted.
In addition to the receding expectations for a substantial rate cut by the Fed, weaker-than-expected U.S. economic indicators released Tuesday “also worked to chill sentiment,” he said.
Falling issues outnumbered rising ones 1,552 to 508 in the TSE’s first section, while 77 issues were unchanged.
Volume decreased to 935 million shares from Tuesday’s 1,029 million shares.
Defensives met with selling, with daily goods supplier Kao falling 2.78 percent, cosmetics maker Shiseido 2.45 percent and job information service firm Recruit Holdings 1.51 percent.
Automaker Isuzu extended its losing streak to a fifth session.
Among other losers were clothing store chain Fast Retailing and technology investor SoftBank Group.
Semiconductor-related issues, including Tokyo Electron and Advantest, fared well on media reports that major U.S. chipmaker Micron Technology Inc. resumed shipments of some products to China’s Huawei Technologies Co.
Also on the positive side were drug maker Astellas and industrial robot producer Yaskawa Electric.
In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average fell 30 points to end at 21,050.
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