Japanese stocks fall to the lowest level in a week

TOKYO (Reuters) – Japanese equities lost more than 1 percent on Tuesday amid concerns over the US-China trade war, unrest in Hong Kong and a stronger yen that hurt economic and financial sectors. to exporters.

According to Reuters, the Nikkei fell 1.1% to close at 20455.44 points, its lowest level in a week, while the Topix, as a whole, lost 1.2% to 1486.57 points.

Economic data released on Tuesday showed demand for Japanese machinery continued to fall in July, although its pace slowed from the previous month.

According to data from the Japan Construction Equipment Manufacturers Association, machinery demand fell by 33% last month compared to the same month last year, after declining 37.9% year-on-year in June. Demand for machinery in Japan has been steadily declining since September 2018.

With the reopening of the market, investors are looking at the news of the weekend, which have already weighed on the stock markets abroad.

Goldman Sachs Group said on Sunday that it no longer expected a trade deal between China and the United States before the 2020 US presidential election.

US President Donald Trump said on Friday that he was not ready to reach an agreement with China and even questioned the trade talks in September, fueling fears that the conflict will end soon.

Sentiment was also touched by the mounting protests in Hong Kong, which closed Monday its busy airport.

Of the 33 sub-indices of the Tokyo Stock Exchange, 32 fell, with business cycle-related sectors such as the three sub-indices of petroleum and coal products, steel and mining leading the way. list of the worst performing sectors, with a drop of 4.5%, 2.9% and 2.8%.

Investor confidence was also affected by the strengthening of the yen, which led to a decline in export inventories: Subaru down 3.6% and TDK down 3.1%.

On the foreign exchange market, the yen reached 105.05 yen for one dollar over the long weekend. All other factors being equal, the strength of the yen is weighing on the income of Japanese exporters.

Bridgestone fell 3.2% after tire maker forecast annual net profit of 290 billion yen ($ 2.75 billion), down 1% from previous forecast of 300 billion yen, due to slowing demand in North America. .