Nikkei closes below 22,000 for first time since October as virus fears pummel markets for fourth day
Tokyo stocks fell for a fourth straight day on Thursday, with the Nikkei index closing below 22,000 for the first time since October amid concerns about an increase in COVID-19 infections around the world.
Fears that the spreading virus would stall the global economy sent all industrial categories down, led by air transportation, securities house and mining issues.
The 225-issue Nikkei average ended down 477.96 points, or 2.13 percent, from Wednesday at 21,948.23, in its lowest finish since Oct. 11.
The broader Topix index of all first section issues on the Tokyo Stock Exchange finished 38.11 points, or 2.37 percent, lower at 1,568.06.
The Nikkei fell more than 570 points at one point following a warning by the U.S. Centers for Disease Control of a possible spread of the new virus, after confirming the first infection of unknown origin in California.
With reports of new infections elsewhere such as Germany, Switzerland and Brazil, fears of a possible pandemic sparked heavy selling, brokers said.
“Anxiety about the virus and fears of its impact on global growth seem to have risen to a new level,” said Shingo Ide, chief equity strategist at the NLI Research Institute.
“As we cannot see any signs of progress being made on the virus front, the Nikkei gauge could go down to the 21,000 line in the coming week or two,” he added.
A news report quoting an International Olympic Committee member as saying that the viral outbreak might delay the Tokyo Olympic and Paralympic Games for a year also dampened market sentiment, brokers said.
But some investors snapped up shares from recent falls, recouping part of earlier losses, they said.
Fears about a rapid global spread of the virus that causes COVID-19 weighed on the U.S. dollar as well, which fell against the perceived safe-haven yen to around the ¥110 line. A tour-bus guide in Japan also tested positive to the virus for a second time, raising questions about how the pathogen spreads.
On the TSE’s first section, declining issues outnumbered advancers 2,059 to 77, while 21 ended unchanged.
Air transportation issues struggled on expectations the viral spread would hurt demand. ANA Holdings sagged ¥163.00, or 5.3 percent, to ¥2,899.00, and Japan Airlines was down ¥127.00, or 4.5 percent, at ¥2,695.50.
Mining, oil and coal related issues continued to fall as a global economic slowdown would weigh on demand for raw materials and fuels.
Mitsui Mining and Smelting dropped ¥138, or 4.9 percent, to ¥2,672, oil refiner JXTG Holdings skidded ¥13.90, or 3.0 percent, to ¥444.60, and explorer Inpex sank ¥31.80, or 3.2 percent, to ¥958.50.
Trading volume on the main section rose to 1.81 billion shares from Wednesday’s 1.68 billion shares.