Tokyo stocks close lower on renewed virus jitters; Nissan dives

TOKYO, Feb 14 (Reuters) – Japanese shares ended lower on Friday as renewed worries about a coronavirus outbreak in China supported demand for the safe-haven yen and weighed on export-oriented stocks.

The benchmark Nikkei average ended down 0.6% at 23,687.59, while the index lost 0.5% for the week to mark its first weekly decline in two.

The broader Topix shed 0.6% to 1,702.87.

“Until Wednesday, people had been saying that you can buy shares because the number of new cases had peaked out. The reality seems to be quite different. An early end to this seems improbable,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

In its latest update, China’s Hubei province health commission said on Friday that it had recorded 116 deaths and 4,823 new cases of the flu-like virus that emerged in the provincial capital, Wuhan, in December.

Japan, which confirmed its first coronavirus death on Thursday, is one of the worst affected of more than two dozen countries and territories outside mainland China that have seen hundreds of infections from the flu-like sickness.

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“Investors will surely avoid Asia for the time being and will shift funds to the U.S., geographically the most separated from the region,” he said.

That meant more demand for the safe-haven yen in the currency exchange market, which serves as a headwind for Japanese exporters’ shares.

All but six of the 33 sector sub-indexes on the Tokyo Stock Exchange were trading lower, with iron and steel, land transport and paper and pulp becoming the worst three performers.

Nissan Motor Co Ltd tumbled 9.6% to its lowest in 10-1/2 years after the automaker cut its annual operating profit forecast by 43%, hit by a slump in vehicle sales and heaping more pressure on new management to rebuild the company after Carlos Ghosn’s ouster.

Toshiba Corp advanced 2.3% as the industrial conglomerate said its operating profit jumped 662% year-on-year in the April-December period, due to bold restructuring.

Bucking overall weakness, SUMCO Corp surged 6.9% to become the second-most traded issue on the main board. The semiconductor silicon wafer maker projected its operating profit for the January-March quarter to fall by 54.6% year-on-year but said supply-demand conditions for 200mm wafers are tightening. (Reporting by Tomo Uetake; Additional reporting by Hideyuki Sano; Editing by Jacqueline Wong and Sherry Jacob-Phillips)

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