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Nikkei briefly sheds over 1,000 pts in wake of Wall Street tumble

Jiji Press TOKYO (Jiji Press) — Stocks turned sharply lower on the Tokyo Stock Exchange Thursday following an overnight plunge in U.S. equities, with the benchmark Nikkei average briefly losing over 1,000 points.

The 225-issue Nikkei average tumbled 915.18 points, or 3.89 percent, to end at 22,590.86, marking the worst finish since Sept 10.

The key index incurred the biggest daily point loss since March 23, when it dropped 974.13 points. On Wednesday, it rose 36.65 points.

The TOPIX index of all First Section issues closed down 62.00 points, or 3.52 percent, at 1,701.86, after climbing 2.74 points the previous day.

The Tokyo stock market was hit by heavy selling after the Dow Jones industrial average ended 831.83 points lower, its third worst daily point loss ever, in New York trading on Wednesday amid worries about higher interest rates.

Investor sentiment was also battered by the yen’s sharp advance versus the dollar, brokers said.

Higher interest rates “eroded the value of stocks, prompting institutional investors to place a massive amount of sell orders,” an official at a bank-affiliated securities house said.

Tomoaki Fujii, head of the investment research division at Akatsuki Securities Co., said, “Futures-led selling accelerated amid a risk-off mood.”

Stocks “fell too much” and the market got “out of control,” Fujii said.

Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management Co., expressed the view that buying on dips was overwhelmed by hefty selling.

Stocks are likely to show volatile movements for a while following Thursday’s setback, Ichikawa noted.

Falling issues far outnumbered rising ones 2,050 to 56 in the TSE’s First Section, while four issues were unchanged.

Volume jumped to 1,952 million shares from Wednesday’s 1,345 million shares.

Sentiment was dampened by a profit warning from Yaskawa Electric, an industrial robot maker considered to benefit from the yen’s recent weakness, brokers said.

Yaskawa Electric lost 6.07 percent after revising down its consolidated operating profit forecast for the year ending in February 2019 to ¥59 billion from ¥65.5 billion on Wednesday.

Export-oriented names, including automaker Toyota, semiconductor manufacturing equipment maker Tokyo Electron and electronic parts supplier Murata Manufacturing, met with heavy selling on the stronger yen.Speech

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