Nikkei dives over 5% among global economic fears
The benchmark index Nikkei index nosedived more than 5 percent on Tuesday morning, beating a 20-month low at one point as an assault in US stocks raised concerns over a decline in the world's largest economy.
The 225-question Nikkei average lost 1.018.74 points, or 5.05 percent, from Friday to 19147.45. The key index fell below the 20,000 line for the first time in 15 months. The financial market was closed Monday in Tokyo due to a national holiday. The wider Topix index for all the first section issues on the Tokyo stock exchange was down 74.27 points, or 4.99 percent, to 1 413.92.
All sectors fell, led by precision instruments, pharmaceutical and farm and fisheries problems.
In the morning, Nikkei reached its lowest level after affecting 1[ads1]8,872.56 in April 2017, and the Topix index dropped to its lowest level since he logged 1,413.59 in November 2016.
The severe decline, as well as was observed in other Asian markets, despite efforts by US Secretary of State Steven Mnuchin to calm investor attacks.
"Mnuchin's conversation with CEOs of major US banks and financial regulators had the opposite effect; there were concerns that the stock market is in a critical condition," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management Co.
On Sunday, Mnuchin spoke Over the phone with six major banks such as JP Morgan Chase and Morgan Stanley assure that they have ample liquidity to support their normal operations.
Monday's meeting with Federal Reserve officials on the same subject damaged the trader's sentiments, brokers said. 19659002] Finance Minister Taro Aso attempted to throw away a sharp selloff in Tokyo, rejecting the plunge as the "overreacting" market to concerns over the global economy.
"Concerns about the prospects for the trade friction between the United States and China help sell," said Aso Journalists in the morning after the Nikkei index lost cards more than 5 percent.
"I want to say (investors) overreact. … Businesses do not do badly at all, "he added.
S & P 500 threw nearly 3 percent to close at a 20-month low for news on the weekend of Mnuchin and a report that President Donald Trump asked "Shoot the Fed Chairman Jerome Powell." "The Trump bubble, which has brought gains in US stocks and dollars, collapses," said Mitsushige Akino, CEO of Ichiyoshi Asset Management Co. in Tokyo. "The more stocks fall, The more investor feeling gets worse, so there are more who need to sell temporarily, such as stop-loss sales. "
Japanese stocks have been caught in a global marketplace, affected by concerns about everything from the US commercial war. And China's global central bank moves to tighten monetary policy, the sentiment has worsened in December, with foreign investors offloading billions of dollars in the country's stocks.
"It's just like panic sales," said Nobuhiko Kuramochi, leader a v investment information at Mizuho Securities Co. in Tokyo. "Stock markets are pricing in concerns over a downturn in the world economy and downsizing corporate earnings in advance. Some investors reduce their exposure to stocks in their portfolio" by increasing cash or bonds. "
Kuramochi said stock markets are approaching a" sales climax "However, the markets need a catalyst, such as an end to the US government closure or a positive outcome of trade negotiations between the United States and China, so some recovery can wait until after the New Year," he said.
