BUSINESS Tokyo stocks close lower after Trump tests positive for COVID-19

BUSINESS

Tokyo stocks close lower after Trump tests positive for COVID-19

Xinhua

20:15, October 02, 2020

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File photo: AFP

Tokyo stocks closed lower Friday after reports US President Donald Trump had tested positive for the novel coronavirus unsettled sentiment, with the news coming amid an already cautious mood following a total shutdown of the exchange the previous day because of a worst-ever malfunction.

The 225-issue Nikkei Stock Average dropped 155.22 points, or 0.67 percent, from Wednesday to close the day at 23,029.90.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, lost 16.27 points, or 1.00 percent, to finish at 1,609.22.

Reports that Trump had tested positive for the novel coronavirus contributed to a risk-off mood extending in the afternoon, with brokers saying the U.S. presidential election outlook could become even more unclear, which is unsettling for markets.

"The virus is believed to have a more serious effect on older people and the president is old. Market players thought this will give his challenger Joe Biden an edge," Shingo Ide, chief equity strategist at the NLI Research Institute, was quoted as saying.

Naoya Oshikubo, senior economist at Sumitomo Mitsui Trust Asset Management, concurred saying, "I suspect markets will lean towards the view that Biden will likely win the election ..."

The market was in cautious mood prior to the news about Trump amid jitters as the Tokyo Stock Exchange (TSE) resumed operations Friday after trading in all shares was suspended for the whole session the previous day due to a major malfunction.

"We apologize anew for the significant trouble we caused due to the system glitch," Japan Exchange Group Inc., the bourse's operator, said in a statement released ahead of the opening bell at 9:00 a.m. local time.

The glitch was the worst the exchange has experienced since 1999 when the system was computerized.

The major glitch was believed to have been caused by a defect in the bourse's trading system with Japan Exchange Group Inc. failing to automatically switch over to its backup system.

The TSE said that defective hardware responsible for the malfunction was replaced and given to Fujitsu Ltd. who developed it, for investigations to begin.

Japan's Financial Services Agency has ordered the TSE to officially report the case and ordered the exchange to ensure that necessary measures are taken so that such a malfunction does not occur again, sources close to the matter said Friday.

By the close of play, pharmaceutical, mining, and electric power and gas-related issues comprised those that declined the most.

Japan Exchange Group declined 1.9 percent, following the previous day's worst-ever system outage, while system developer Fujitsu ended the day 2.8 percent lower.

Pharmaceutical issues were sold for profits, with Ono Pharmaceutical dropping 4.1 percent, Daiichi Sankyo sinking 5.1 percent, while Shionogi closed down 3.8 percent.

The yen's appreciation sent exporters lower, among which Mitsubishi Motors skidded down 2.2 percent, while Mazda Motor reversed 2.8 percent by the close.

Railway issues were also sold for gains, with Central Japan Railway falling 2.6 percent, West Japan Railway down 2.3 percent and East Japan Railway retreating 2.5 percent.

Department store operators bucked the downward trend, however, helped by an earnings upgrade by J.Front Retailing who added 2.5 percent by the close.

Isetan Mitsukoshi climbed 4.1 percent, while Takashimaya also closed in positive territory, advancing 3.5 percent.

On the main section on Friday trading volume increased to 1.484 billion shares from Wednesday's volume of 1.442 billion shares.

The turnover on the final trading day of the week came to 2.864 trillion yen (27.233 billion U.S. dollars).

Owing to Thursday's major glitch, the numbers of advancing and declining issues on the First Section were not available Friday.

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