CORRECTED-Japanese stocks drop as Wall Street slides on virus resurgence fears

  • Reuters
  • Stock Market News
CORRECTED-Japanese stocks drop as Wall Street slides on virus resurgence fears

(in 11th para, deletes erroneous reference to the number of companies that have reported earnings so far)

SYDNEY, May 13 (Reuters) - Japanese shares dipped further from a two-month high on Wednesday, tracking overnight losses on Wall Street on fears of a second wave of COVID-19 infections, while some profit taking also weighed on the market.

The benchmark Nikkei average .N225 fell 0.5% to 20,267.05, with cyclical sectors leading the declines.

Traders said some profit booking was inevitable sooner or later because of the recent rally. On Monday, both the Nikkei and the Topix climbed to their highest levels since March 6.

Wall Street's all three major indexes dropped about 2% on Tuesday following a warning from Dr. Anthony Fauci, the top infectious disease expert in the United States, that premature moves to reopen the economy could lead to a second wave of cases and set back economic recovery. .N

Investors also kept a watch on simmering U.S.-China tensions after a leading U.S. Republican senator proposed legislation that would authorize President Donald Trump to impose sanctions on China if it fails to give a full account of events leading to the virus outbreak. broader Topix .TOPX pared most of the early losses and ended the session at 1,474.69, just 0.1% lower on the day.

Analysts suspected the Bank of Japan's exchange-traded fund (ETF) buying, as part of its stimulus programme, buoyed the market in the afternoon.

About two-thirds of the 33 sector sub-indexes on the Tokyo exchange finished in negative territory.

Highly cyclical iron and steel .ISTEL.T , insurance .IINSU.T and air transport .IAIR.T sectors were among the worst performers in the main bourse.

"COVID-19 has had a significant impact on broad businesses, regardless of industry," said Keiichi Ito, chief quant analyst at SMBC Nikko Securities.

"Among companies which already announced earnings results, about 60% of them have suspended full-year profit guidance, compared with 10% usually."

Shiseido Co Ltd 4911.T tumbled 4.2% after its net profit plunged by 95.8% in the January-March quarter and as the cosmetics maker withdrew full-year profit and dividend guidance, citing COVID-19 uncertainty. Motor Corp 7203.T , the biggest Japanese company by market value, lost 2.2% following the automaker's warning that its operating profit will slump almost 80% in the current financial year through March 2021. the overall weakness, NEC Corp 6701.T jumped 6.5% to a 2-1/2-month high after the electronics maker surprised investors by raising its annual dividend forecast.

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or


Related Articles