Friday, 21 August 2015 12:12
TOKYO: Tokyo’s benchmark stock index dropped 2.98 percent on Friday, piling on its fourth day of losses as fears about the health of the global economy pounded equity markets.
The Nikkei 225 at the Tokyo Stock Exchange tumbled 597.69 points to finish at 19,435.83, its lowest close in just over three months.
The broader Topix index of all first-section shares was down 3.13 percent, or 50.87 points, to end at 1,573.01.
“Now players are concerned about not just external factors such as the Greek crisis or a speculative sell-off in China, but a deterioration in the real global economy,” Kenzaburo Suwa, strategist at Okasan Securities in Tokyo, told AFP.
“This will have a real impact on the Japanese economy for sure,” he added.
Investor jitters have spiked on concerns that China’s slowdown would drag on global growth, with currency traders moving into the yen, which is seen as a safe-haven in times of turmoil and uncertainty.
The dollar weakened to 122.97 yen from 123.38 yen in New York, a negative for shares of Japanese exporters as a stronger yen hurts their profitability and competitiveness overseas.
Dealers said markets remained under pressure from uncertainty about China after the shock devaluation of the yuan last week added to fears the world’s second-biggest economy is slowing more than thought.
Stoking concerns, an independent survey on Friday showed China’s manufacturing activity slumped to a 77-month low in August.
The US Federal Reserve cited China as a red flag for global growth in the minutes of its last meeting, released this week, which lowered expectations the central bank could lift rates as early as next month.
Plunging oil prices, which looked set to notch their eighth week of falls, also weighed on investor sentiment.
“The environment surrounding markets has changed with the Chinese economy slowing and commodity prices plunging,” Ryuta Otsuka, a strategist at Toyo Securities, told Bloomberg News.
“Investors are unable to have confidence in either the economy or corporate earnings,” he added.
In Tokyo share trading Friday, market heavyweight Fast Retailing, operator of the Uniqlo chain, plunged 3.46 percent to 52,170 yen.
Mobile carrier SoftBank was down 3.66 percent to 7,362 yen, while Sony dropped 4.33 percent to 3,090 yen.
Toyota ended 3.0 percent lower at 7,500 yen after a weak lead from Wall Street, where the Dow Jones Industrial Average closed down 2.06 percent at 16,990.69, its lowest finish this year.
The broad-based S&P 500 dropped 2.11 percent while the Nasdaq slumped 2.82 percent.
