Japan Nikkei falls on simmering trade worries

Headline indices of the Japan share market slipped into negative territory on Wednesday, 12 September 2018, in the wake of the trade tensions and concerns about the crises in Turkey and Argentina. However, market losses were limited as traders were looking to individual shares with prospects of strong earnings. Total 26 issues out of 33 TSE index declined, with shares of Electric Appliances, Machinery, Construction, Metal Products, Marine Transportation, and Chemicals issues being notable losers, while Mining, Information & Communication, and Fishery, Agriculture & Forestry issues were notable gainers. In late afternoon trade, the 225-issue Nikkei Stock Average declined 86.64 points, or 0.4%, to 22,578.05. The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, dropped 9.85 points, or 0.6%, to 1,689.06.

Investor confidence was chilled by the latest round of verbal threats in an intensifying US-China trade conflict. China told the World Trade Organization (WTO) on Tuesday it wanted to impose $7 billion a year in sanctions on the United States in retaliation for Washington's non-compliance with a ruling in a dispute over U.S. dumping duties. Separately, US President Donald Trump told reporters on Tuesday that the United States was taking a tough stance with China.

 

Shares of export-related companies were mostly lower on a flat yen and worries about global trade tensions. The dollar fetched 111.52 yen in Asian trade, against 111.57 yen in New York late Tuesday. Mitsubishi Electric was down more than 1%, while Panasonic and Canon were lower by almost 1% each. Sony rose 0.7%. Toyota Corp declined 0.7% and Honda Motor fell 1.4%.

CURRENCY NEWS: Japanese yen was little changed in the upper 111 yen zone against greenback on Wednesday. Around afternoon, the dollar was quoted at 111.61-62 yen compared with 111.59-69 yen in New York and 111.53-55 yen on Tuesday in Tokyo. The euro, meanwhile, fetched 129.42-46 yen against 129.49-59 yen in New York and 129.70-74 yen in Tuesday trade in Tokyo.

OFFSHORE MARKET NEWS, US stock market closed higher on Tuesday. The Dow Jones Industrial Average rose 113.99 points or 0.4% to 25,971.06, the Nasdaq climbed 48.31 points or 0.6% to 7,972.47 and the S&P 500 advanced 10.76 points or 0.4% to 2,887.89.

The major European stock markets ended mixed on Tuesday. The French CAC 40 Index climbed by 0.3%, the German DAX Index and the U.K.'s FTSE 100 Index both edged down by 0.1%.

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