Tokyo stocks open lower on US-China tension

TOKYO, May 29 ― Tokyo stocks opened lower today, tracking falls on Wall Street on rising tensions between the US and China.

The benchmark Nikkei 225 index was down 0.56 per cent or 123.03 points at 21,793.28 in early trade, while the broader Topix index slipped 0.65 per cent or 10.20 points to 1,567.14.

“Ahead of the weekend, the Japanese market is seen weighed down by falls in US shares,” Okasan Online Securities said in a commentary.

It cited US President Donald Trump's decision to hold a press conference on China following Beijing's approval of a plan for a security law for Hong Kong.

The move came after Washington revoked the special status conferred on Hong Kong, paving the way for the territory to be stripped of trading and economic privileges.

US Secretary of State Mike Pompeo said the status had been withdrawn because China was no longer honouring its handover agreement with Britain to allow Hong Kong a high level of autonomy.

The dollar fetched ¥107.66 (RM4.35) in early Asian trade, against ¥107.59 in New York late yesterday.

In Tokyo, Nissan dived 6.67 per cent to ¥420.3 and its smaller alliance partner Mitsubishi Motors dropped 4.49 per cent to ¥319 after Nissan reported a huge US$6.2-billion annual net loss as it reels from the impact of the coronavirus.

“We are extremely concerned about the impact from the coronavirus pandemic,” ratings agency Moody's said in a statement sent to AFP.

“The worsening of the global economic outlook could have great impact on demand in the auto industry,” it said.

Other carmakers were also lower, with Toyota trading down 1.31 per cent at ¥6,881 and Honda off 1.91 per cent at ¥2,842.5 yen.

Among other shares, Sony was up 0.78 per cent at ¥6,938 and Uniqlo casualwear operator Fast Retailing was up 0.82 per cent at ¥59,600.

Japan's jobless rate in April stood at 2.6 per cent ― worse than 2.5 per cent in the previous month and the highest figure since December 2017, the internal affairs ministry said minutes before the opening bell.

And Japan's industrial output plunged 9.1 per cent month-on-month in April, the industry ministry said separately, noting in a commentary that the country's factory output “is rapidly declining”.

On Wall Street, the Dow ended down 0.6 per cent at 25,400.64. ― AFP