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Nikkei in worst fall for 8 1/2 months, Middle East concerns weigh

Published 06-12-2017, 12:24 pm
Updated 06-12-2017, 12:30 pm
© Reuters.  Nikkei in worst fall for 8 1/2 months, Middle East concerns weigh
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* Investors rush to take profits after break of 25-day average

* Trump's plan on Jerusalem fans worries about Middle East

By Hideyuki Sano

TOKYO, Dec 6 (Reuters) - Japan's Nikkei share average posted its biggest fall in 8 1/2 months on Wednesday as investors rushed to lock in gains after it broke below the key technical support from its 25-day moving average.

Market sentiment was also bruised on the news U.S. President Donald Trump will recognise Jerusalem as Israel's capital and set in motion the relocation of the U.S. Embassy to the ancient city, a move that is feared could fuel violence in the Middle East. Nikkei share average .N225 fell 2 percent, its biggest daily fall since March 22, to a near three-week low of 22,177.04.

A clear break of its 25-day moving average, above which it had stayed since September, prompted selling. The average stood at 22,514 on Wednesday.

Market players said investors rushed to take profits from gains in recent months, with materials and other cyclical shares leading the losses following a tumble in copper prices.

The non-ferrous metals producer index .INFRO.T fell 3.0 percent to become the top loser among the Tokyo Stock Exchange's 33 industry subindexes, followed by miners .IMING.T and shippers .ISHIP.T .

Nikkei heavyweights Fast Retailing 9983.T and Nitto Denko 6988.T fell 4.9 percent and 4.4 percent respectively, helping the Nikkei underperform broader Topix, which fell 1.5 percent to 1,765.42.

The turnover hit 3.2 trillion yen, 33 percent more than the average over the past year.

In the main board, 82 percent of shares dropped while only 15 percent made gains. .TSEC

"There are many excuses to sell at the moment, the Middle East, North Korea, worries about Russia-gate, you name it. But essentially people just hurried to take profits now," said Yasuo Sakuma, chief investment officer at Libra Investments.

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