Roundup: Tokyo stocks close lower on caution ahead of earnings

0 Comment(s)Print E-mail Xinhua, July 28, 2020
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TOKYO, July 28 (Xinhua) -- Tokyo stocks closed lower Tuesday as early gains made on technology issues' advance gave way to market caution and selling ahead of the release of domestic corporate earnings reports.

The 225-issue Nikkei Stock Average lost 58.47 points, or 0.26 percent, from Monday to close the day at 22,657.38.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, dropped 7.57 points, or 0.48 percent, to finish at 1,569.12.

Technology-linked issues were snapped-up in early trade, local brokers said, following a solid performance by their U.S. counterparts overnight on hopes for further government stimulus measures.

But the pace of selling quickened in later trade with earlier gains being erased, as investors took to selling amid a cautious mood ahead of Japanese firms releasing earnings reports which will reveal the extent of the impact on profits and outlooks as a result of the pandemic, market analysts said.

Adding to a wait-and-see mood ahead of earnings season here swinging into gear, investors also hit the sidelines to await the outcome of an upcoming U.S. monetary policy meeting, they added.

"With a U.S. monetary policy meeting also coming up, a wait-and-see mood dictated the market," Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co., was quoted as saying, adding "Few market players expect any change to the policy this time, however."

Adding to investor consternation was the Tokyo metropolitan government saying that new daily COVID-19 cases had rebounded from a day earlier from 131 cases to 266 new infections, amid concerns over the pace of the virus' spread in the capital.

New cases of the virus in July has surpassed the 5,000-mark, accounting for about 50 percent of Tokyo's cumulative total of more than 11,600 cases cases and one-third of the nation's total.

Local traders said that the coronavirus situation in the capital ignited some concerns that restrictions could be reissued for businesses and residents if the pace of the spread continues. This, they said, against a backdrop of surging cases in other major economies, particularly the United States, further fueling concerns and hurting transportation issues like airline carriers, they said.

By the close of play, air transportation, electric power and gas, and real estate issues comprised those that declined the most.

Mitsubishi Motors was a notable decliner, plunging a record 12.6 percent, after the automaker announced it expects a group net loss of 360 billion yen (3.4 billion U.S. dollars) for the current business year through March, due to declining sales amid the pandemic.

Alliance partner Nissan Motor, set to announce its earnings later in the day, dropped 4.3 percent.

Among other issues whose firms reported disappointing earnings, Hitachi Construction fell 6.2 percent by the close.

Bucking the downward trend, Yokohama-based video game maker Koei Tecmo Holdings surged a record 13.4 percent, after reporting solid earnings.

Issues that fell outpaced those that rose by 1,534 to 557 on the First Section, while 81 ended the day unchanged.

On the main section on Tuesday, 1.088 billion shares changed hands, dropping from Monday's volume of 1.160 billion shares.

The turnover on the second trading day of the week came to 1.987 trillion yen (18.885 billion U.S. dollars). Enditem

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