Japan's Nikkei hits 9-day low as recession fears grip markets

  • Reuters
  • Stock Market News
Japan's Nikkei hits 9-day low as recession fears grip markets
Credit: © Reuters.

* Nikkei sheds 1.21%, brushes 9-day low

* Strong yen hits exporters, lower yields weigh on financials

By Shinichi Saoshiro

TOKYO, Aug 15 (Reuters) - Japan's Nikkei hit a nine-day low on Thursday as resurgent global recession fears triggered a Wall Street slide and sent the safe-haven yen higher, weighing heavily on the country's export firms.

The Nikkei share average .N225 ended the day down 1.21% at 20,405.65. During the day, it touched 20,184.85, its lowest since Aug. 6.

All three major U.S. indexes closed down about 3% on Wednesday, with the blue-chip Dow .DJI posting its biggest one-day point drop since October, after the U.S. Treasury yield curve temporarily inverted for the first time in 12 years -considered a classic recession signal. .N

"Market confidence has already been deteriorating steadily due to the ongoing U.S.-China trade conflict and the Treasury yield curve inversion looks to have pushed sentiment over the edge," said Yoshinori Shigemi, global market strategist at JP Morgan Asset Management.

Shares of Japanese exporters retreated as the safe-haven yen JPY= strengthened against the dollar due to the widespread risk aversion.

Toyota Motor Corp 7203.T fell 0.9%, Honda Motor Co 7267.T dropped 1.4%, Panasonic 6752.T shed 2.6% and Bridgestone Corp 5108.T was down 1.1%.

Financial institutions also took a hit, as the sharp drop in bond yields was seen hurting their profitability. Mitsubishi UFJ Financial Group 8306.T lost 1.1%, Mizuho Financial Group 8411.T retreated 0.5% and Dai-ichi Life Holdings 8750.T sank 1.6%.

Energy-related shares declined as crude oil prices fell on the back of global recession concerns. Refiner Idemitsu Kosan Co 5019.T dropped 1.9% and natural gas and oil developer Inpex Corp 1605.T pulled back 1.8%.

The few gaining stocks included robotics company Cyberdyne Inc 7779.T , which rallied 4.9% after its April-June pretax profit returned to the black with its medical robotic suits finding demand at home and abroad. broader Topix .TOPX was down 1.04% at 1,483.85.

Declining shares outnumbered gainers by 1,812 to 272.

All of Tokyo's 33 sub-indexes were in the red, with oil and coal products .IPETE.T and precision machinery .IPRCS.T the biggest losers. (Editing by Sam Holmes)

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