Nikkei hits 3-1/2-year low as investors flee equities; SoftBank Group tumbles

  • Reuters
  • Stock Market News
Nikkei hits 3-1/2-year low as investors flee equities; SoftBank Group tumbles
Credit: © Reuters.

March 18 (Reuters) - Japan's Nikkei share benchmark saw its lowest finish since November 2016 on Wednesday despite an overnight rally on Wall Street, as worries about the coronavirus outbreak eclipsed hopes that broad policy support would combat the economic fallout.

The Nikkei average .N225 shed 1.7% to 16,726.55, a 3-1/2-year closing low, having reversed earlier gains in choppy trade.

The Nikkei's volatility index .JNIV , a measure of investors' volatility expectations based on option pricing and considered a gauge of investor fear, fell 0.9% to 56.12, remaining in the vicinity of Monday's nine-year peak of 60.86.

Adding to wariness were U.S. stock futures ESc1 which slid 3.7% in Asia, falling to their daily limit outside U.S. trade, a day after the S&P 500 .SPX climbed 6.0% and the Dow .DJI gained 5.2%. .N

Nikkei heavyweight SoftBank Group Corp 9984.T plunged 10.9%, taking its market cap below that of domestic mobile phone subsidiary SoftBank Corp 9434.T for the first time.

The broader Topix .TOPX edged up 0.2% to 1,270.84, moving off a near four-year trough touched on Tuesday.

Hopes of the Bank of Japan (BOJ) buying Exchanged Traded Funds (ETFs) more aggressively lent support to the broad market, traders said.

The BOJ bought a record 120 billion yen ($1.12 billion) of Japanese stock ETFs on Tuesday, even though the Topix index rose in the morning. Governor Haruhiko Kuroda told parliament on Wednesday that at current Nikkei levels, latent losses on the BOJ's holdings of ETFs were likely around 2 trillion to 3 trillion yen ($19 billion to $28 billion). shares in Fujifilm Holdings Corp 4901.T jumped by a daily limit of 15.4% after a Chinese official said the company's Avigan anti-flu drug appeared to help coronavirus patients recover. gaps between individual shares were among the widest in recent years. In the Topix core 30 .TOPXC , the best performer, Kao Corp 4452.T , climbed 7.4%, while the worst, SoftBank Group 9984.T , lost 10.9%.

($1 = 107.2800 yen)

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