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Flagship stocks in the Japanese equity market ended lower on Thursday, July 05, 2018, as investors risk avenging aversion triggered by market nervousness ahead of Washington's proposal on Chinese imports. Meanwhile, the appreciation of the marginal yen against the greenback fueled the selloff. All TSE33 issues declined, with shares in the oil and coal, nonferrous metals, retail, rubber products, electrical appliances, securities and commodities, banks, iron and steel and shipping sectors being notable losers. At closing, the benchmark Nikkei 225 fell 0.78%, or 170.05 points, to 21,546.99. The broader Topix index of all issues of the First Section on the Tokyo Stock Exchange, meanwhile, fell 1.01%, or 17.05 points, to 1,676.20.
Market participants were concerned about the negative implications of the US trade war with the rest of the world. A trade war between the United States and the rest of the world could lead to a global financial crisis. The United States should impose tariffs on Chinese exports on July 6. The United States has also imposed tariffs on cars coming from Europe. Although Japan has not benefited from US tariffs, a global trade war could be devastating for the Japanese economy, which depends heavily on its export sector.
The Chinese Customs Department on Thursday informed Chinese markets that the retaliation rights on US products would come into effect immediately after the entry into force of US duties on Chinese imports. The Trump administration imposed a 34% tariff on Chinese products. retaliated by announcing tariffs on the same value of American goods.
Sony Corp. shares lost 3.4%, hit by profit taking among domestic institutional investors in a risk-averse environment stemming from the trade dispute between China and the U.
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Taiyo Yuden plunged 4% due to a drop in the rating of the company's brokerage firm. Morgan Stanley Securities MUFG Co. has lowered its investment grade for the electronic parts manufacturer.
In contrast, beer brewer Asahi Group gained ground one day after Goldman Sachs Japan Co. revised up its investment grade and target price of the company's shares.
NEWS FROM CURRENCY: The Japanese yen is slightly appreciated at the mid-110 yen against the US dollar on Thursday in Tokyo. The dollar was quoted at 110.40-45 yen against 110.47-48 yen on Wednesday in Tokyo.
OFFSHORE MARKET: The US stock markets were closed Wednesday for the Independence holiday. European equity markets were mixed on Wednesday. The pan-European index STOXX600 fenced flat. But the German indices Dax and UK FTSE both fell by 0.3%.
NEWS ON COMMODITIES: Crude oil prices rose on Wednesday, driven by lower crude oil inventories in the United States and rising Iranian supply risks. Iranian President Hassan Rouhani has hinted that his country could disrupt regional crude oil exports if the United States followed with sanctions against Iranian oil sales. Brent rose 48 cents US or 0.6% to 78.24 US dollars per barrel and US Nymex (not settled due to the US holiday) rose 19 cents US or 0.3% to 74.33 US dollars a barrel.
Base metal prices were lower on the London Metal Exchange (LME) on Wednesday before the new US trade rates expected Friday. Zinc (-3.2%) fell to almost a year of hollow. Copper (-1.5%) was close to 11-month lows. Producer Freeport-McMoran has obtained the extension of a temporary operating license at his Grasberg mine, which has likely boosted copper supply. Aluminum increased by 0.9%.
Generated by Capital Market – Live News
(This story was not edited by the Standard Business Team and is generated automatically from. A union thread.)
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