Japan's Nikkei falls on worries about US-China trade tension, stronger yen

Time of India

2 days ago

Japan's Nikkei share average fell on Monday, dragged lower by worries over trade tensions between the U.S. and China, and a
stronger yen
, which hurt
automakers
.
As of 0204 GMT, the Nikkei dropped 1.4% at 37,428.14 and the broader Topix slipped 1.02% to 2773.
"Investors were worried about rising uncertainties about trade issues," said Shoichi Arisawa, general manager of investment research at IwaiCosmo Securities.
"Optimism over the tariff policy, which pushed the Nikkei over the psychologically important level of 38,000 last week, has vanished."
U.S. President Donald Trump on Friday accused China of breaching a trade agreement with the U.S. and issued a new veiled threat to get tougher with Beijing.
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Trump later said he would speak to China's President Xi Jinping and hopefully work out their differences on trade and tariffs.
The yen strengthened on Monday, following the declines of U.S. Treasury yields on Friday, which also weighed on
Japanese stocks
, said Arisawa.
The yen rose 0.37% to 143.5 against the U.S. dollar.
A stronger yen typically weighs on exporter shares by reducing the value of overseas earnings when converted back into Japanese currency.
"One market-moving cue would be the
G7 leaders' summit
to be held in Canada later this month, where we may see the fate of trade talks between Japan and the U.S.," said Arisawa.
Automakers fell, with
Toyota Motor
and
Honda Motor
down 2.49% and 2.11%, respectively.
Chip-related shares fell, with Advantest and Tokyo Electron slipping 3.57% and 2%, respectively.
All but three of the
Tokyo Stock Exchange
's 33 industry sub-indexes fell, with the auto sector and tyre makers losing 1.95% and 2.38%, respectively, to become the worst performers.
Sumitomo Realty & Development was up 1.5%, after jumping as much as 7% as a government filing showed an activist
Elliott International
took a 2.99% stake in the property developer.
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