SYDNEY, June 12 (Reuters) - Japanese stocks skidded to two-week lows on Friday after Wall Street dived on fears that a resurgence of COVID-19 infections could stunt the pace of reopening economies.
The benchmark Nikkei average .N225 dropped 1.5% to 22,131.14 by the midday break, after hitting its lowest level since May 29 earlier in the session.
For the week, the Nikkei was down 3.2%, poised for its biggest decline in two months.
U.S. shares plummeted on Thursday as investors reacted to renewed fears of a pandemic resurgence and digested dour economic forecasts from the Federal Reserve, with all three major indexes losing well over 5%. .N
In the currency market, the safe-haven yen stood firm on renewed pessimism over a quick economic recovery, with the dollar/yen JPY=EBS hitting 106.58 overnight, a level unseen in a month. FRX/
As a stronger yen hurts Japanese manufacturers' profits made abroad when repatriated, shares of export-oriented automakers remained under pressure, with Subaru 7270.T shedding 3.5% and Honda Motor 7267.T falling 2.5%.
"The ongoing steep correction shows you what type of investors and money is playing in these markets and how fragile the rally was," said Takeo Kamai, head of executions services at CLSA in Tokyo.
The broader Topix .TOPX lost 1.8% to 1,560.16 by the recess, after hitting a two-week low earlier, with all the 33 sector sub-indexes on the Tokyo exchange trading lower.
Nichiigakkan 9792.T added 0.9% after Hong Kong-based investment fund LIM Advisors said in a letter to management that Bain Capital's tender offer "substantially" undervalued the Japanese nursing home operator.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.