Nikkei dragged down by Wall St sell-off, Japan Q3 GDP contraction

  • Reuters
  • Stock Market News
Nikkei dragged down by Wall St sell-off, Japan Q3 GDP contraction
Credit: © Reuters.

* Worries over fresh Sino-U.S. trade tensions hit sentiment

* Machinery and semiconductor-related stocks fall

* Pioneer slumps 28.4 pct on news of buyout, delisting

By Daniel Leussink

TOKYO, Dec 10 (Reuters) - Japan's Nikkei fell on Monday, tracking a sharp sell-off on Wall Street on renewed Sino-U.S. trade tensions and a deeper-than-expected contraction in the Japanese economy in the third quarter.

The Nikkei share average .N225 shed 2.25 percent to 21,191.23, ending the morning session close to its lowest level since Oct. 30.

Japan's benchmark index has fallen 13.3 percent from a 27-year high hit in early October.

U.S. equity futures and Asian shares slipped on Monday on worries over slowing growth and fears of fresh trade tensions between Washington and Beijing. gross domestic product shrank at a below-forecast annualised rate of 2.5 percent in July-September, deeper than an initial estimate of a 1.2 percent contraction, revised data showed on Monday. suggests that companies are cooling on their capital expenditure plans. That's putting selling pressure on machinery stocks," said Eiji Kinouchi, chief technical analyst at Daiwa Securities.

Investors are also concerned a fresh flare-up in Sino-U.S. tensions could crush any chances of a trade deal between Washington and Beijing.

Factory automation equipment makers Fanuc Corp 6954.T dropped 2.8 percent, Nabtesco Corp 6268.T lost 3.0 percent and Keyence 6861.T gave up 3.1 percent.

Selling extended to shares of personal care goods makers that have seen strong demand from Chinese consumers.

Such stocks are more defensive than semi-conductor and machinery firms, Kinouchi said. "If you look at what stocks have sold off before, it shows that sentiment has become worse," he added.

Cosmetics maker Shiseido Co 4911.T dropped 2.4 percent and Kao Corp 4452.T was off 3.6 percent.

Index-heavyweights Fast Retailing 9983.T and SoftBank Corp 9984.T gave up 2.1 percent and 3.0 percent, respectively, while Nintendo 7974.T was flat.

Audio equipment maker Pioneer Corp 6773.T plummeted 28.4 percent as it started trading after news on Friday that the company will be bought by buyout firm Baring Private Equity and be delisted. Display 6740.T lost 10.6 percent after the Nikkei business daily reported that the company is cutting production of smartphone liquid crystal displays in December. broader Topix .TOPX lost 2.01 percent to 1,587.87, with all but two subsectors trading in negative territory.

(Editing by Jacqueline Wong)

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