TOKYO (Kyodo) — Tokyo stocks fell Tuesday, pressured by fears over a trade war triggered by U.S. tariffs imposed on China, Mexico and Canada, while exporters were sold on the yen’s brief appreciation.
The 225-issue Nikkei Stock Average ended down 454.29 points, or 1.20 percent, from Monday at 37,331.18. The broader Topix index finished 19.38 points, or 0.71 percent, lower at 2,710.18.
On the top-tier Prime Market, decliners were led by nonferrous metal, securities house and mining issues.
The U.S. dollar briefly weakened to as low as 148.60 yen in Tokyo as the yen was bought after U.S. President Donald Trump claimed that Japan is pursuing a policy to devalue the yen, dealers said. The U.S. currency later rebounded to the lower 149 yen level.
At 5 p.m., the dollar fetched 149.34-36 yen compared with 149.45-55 yen in New York and 150.17-18 yen in Tokyo at 5 p.m. Monday.
The euro was quoted at $1.0492-0494 and 156.69-73 yen against $1.0484-0494 and 156.68-78 yen in New York and $1.0405-0406 and 156.26-30 yen in Tokyo late Monday afternoon.
The yield on the benchmark 10-year Japanese government bond rose 0.015 percentage point from Monday’s close to 1.420 percent after the debt was sold on a weak auction result of the bond issued by the Finance Ministry.
Stocks stayed in negative territory throughout the day as investors grew wary about the impacts of an additional U.S. tariff on imports from China, and 25 percent tariffs on Canadian and Mexican goods entering the United States that took effect Tuesday.
After Washington doubled its additional tariff imposed on imports from China to 20 percent, Beijing announced retaliatory steps of raising tariffs on U.S. farm imports next week.
“There is great concern that trade friction between the United States and China could escalate,” which would deal a heavy blow to the Japanese economy, said Masahiro Yamaguchi, head of investment research at SMBC Trust Bank.
Some heavyweight technology issues were sold, tracking declines by their U.S. counterparts overnight and briefly sending the Nikkei benchmark below the 37,000 threshold. But stocks trimmed losses as investors moved to hunt for bargains, brokers said.