Tokyo stocks dive after U.S. sell-off


A man looks at an electronic board showing the Nikkei average outside a brokerage in Tokyo on Tuesday.

Jiji PressTOKYO (Jiji Press) — The benchmark Nikkei average plunged over 1,000 points on the Tokyo Stock Exchange Tuesday, battered by a wave of selling by investors who became risk-averse after an overnight tumble in U.S. equities.

The 225-issue Nikkei average dived 1,071.84 points, or 4.73 percent, to finish at 21,610.24, the lowest closing level since Oct. 20 last year.

The drop was the biggest single-day point loss since June 24, 2016, when the Tokyo market was dragged down by news that Britain had voted to exit from the European Union. On Monday, the key market gauge lost 592.45 points.

The TOPIX index of all first-section issues closed down 80.33 points, or 4.40 percent, at 1,743.41, after shedding 40.46 points the previous trading day.

Tokyo stocks fell almost across the board after the Dow Jones industrial average plummeted 1,175.21 points, or 4.60 percent, in New York on Monday, incurring the worst one-day point loss ever.

The Tokyo market accelerated its downswing in the afternoon as market players stepped up selling to avoid further losses, with the Nikkei briefly giving up over 1,600 points.

The market was also weighed down by the yen’s rise against the dollar. The yen attracted purchases as a safe-haven currency following sharp falls in New York and Tokyo equities, currency traders said.

Stocks, however, attracted buybacks toward the close in line with the yen’s easing, recouping some of their hefty losses.

Ryuta Otsuka, strategist at the investment information department of Toyo Securities Co., said losses in other Asian markets dampened the sentiment of investors in the Tokyo market, inducing heavy sell-offs.

Buying on dips was held in check to some extent “due to concerns over further falls in U.S. stocks,” said Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc.

“Tokyo stocks will unlikely rebound unless Wall Street turns higher,” Fujii said.

Tokyo stocks met with “selling that was unreasonable in terms of their valuations,” Otsuka said, stressing that corporate earnings in Japan are brisk.

Falling issues overwhelmed rising ones 2,027 to 35 in the TSE’s first section, while three issues were unchanged.

Volume shot up to 3,155 million shares from 1,881 million shares on Monday.

Oil companies Japex, Inpex and JXTG met with selling, reflecting lower crude oil prices.

Export-oriented names, including automakers Toyota, Nissan and Honda, as well as technology firms Hitachi and Canon, were downbeat, dragged down by the yen’s appreciation.

Other major losers included clothing retailer Fast Retailing, machine tool maker Fanuc and mobile phone carrier SoftBank Group.

By contrast, food producer Maruha Nichiro and automaker Mitsubishi Motors were among a few winners.

In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average tumbled 1,140 points to close at 21,510.Speech

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