Tokyo stocks have plunged 2.38 per cent to a six-month low on a negative lead from Wall Street.
Tokyo stocks have fallen 2.38 per cent to their lowest close in six months, leading a fall on Asian markets following a sell-off on Wall Street and disappointment over the Bank of Japan’s hawkish view on additional easy money.
The benchmark Nikkei-225 index on Friday sank 340.07 points to finish at 13,960.05, its lowest close since early October, while the Topix index of all first-section shares lost 1.34 per cent, or 15.40 points, to 1,134.09.
Market heavyweight Fast Retailing plunged 7.87 per cent to 33,820 yen after the Uniqlo clothing chain operator cut its full-year earnings forecast, blaming weaker demand at home.
“We are going to change everything about how we do our operations in Japan 180 degrees,” the company’s chief executive, Tadashi Yanai, told news briefing in Japan on Thursday.
The selling on Friday was partly driven by Bank of Japan governor Haruhiko Kuroda’s comments earlier this week, dismissing any hopes for further monetary easing in the near future, saying the world’s No.3 economy was getting back on track despite a sales tax rise that has exacerbated fears of a drop-off in consumer spending.
“No hints of additional easing from the Bank of Japan triggered recent selling,” said Takashi Hiratsuka, a trading group leader at Resona Bank’s asset management division.
Anxiety about pricey technology stocks returned with a vengeance to Wall Street, sending the Nasdaq down 3.10 per cent to 4,054.11, its biggest single-day drop in percentage terms since November 2011.
The Dow sank 1.62 per cent and the S&P 500 fell 2.09 per cent.
The drop came just ahead of US earnings season, which will be a key trading cue for investors.
“The biggest concern is that US corporate earnings may not be as strong as hoped, making Wall Street look overvalued,” said Shinkin Asset Management fund manager Naoki Fujiwara.
Tech-linked Japanese shares took a hit with mobile giant SoftBank tumbling 3.81 per cent to Y6,900 and chip giant Tokyo Electron dropping 4.54 per cent to Y5,876.
Consumer electronics giant Sharp fell 1.32 per cent to finish at Y299.
The Tokyo market has also been under pressure from a stronger yen, which hurts the profitability of Japanese exporters.
In forex trade, the US dollar bought Y101.80, up from Y101.44 in New York, but flat against the Y101.81 in Tokyo earlier on Thursday.