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Japan stocks sink as economic worries linger

Japan stocks sink as economic worries linger

Japanese stocks tumbled Thursday, dragged down by lingering pessimism over the global economy after Wall Street failed to convincingly build on a recent rebound.
The benchmark Nikkei 225 index lost 177.87 points, or 2.4 percent, to 7,198.25 after vaulting more than 4 percent a day earlier.
The broader Topix index dropped 3 percent to 700.93, the lowest since Dec. 14, 1983 when it closed at 696.19.
"Sentiment in Tokyo turned downbeat as investors were disappointed by marginal gains in the U.S. market yesterday. With feeble gains overnight, investors were worried U.S. shares could fall again Thursday," said Yutaka Miura, senior strategist at Shinko Securities Co. Ltd.
The Dow Jones industrial average edged up just 3.91, or 0.1 percent, to 6,930.40 on Wednesday after storming higher the previous session amid hopes the ailing financial sector can recover.
The rise gave the blue chips their third advance in four sessions. But the buying was subdued with investors betting stocks would continue to slide as the global downturn deepens.
"The global stock markets remain under pressure due to uncertainty over a slump in the world economy," Miura said.
Japan's stocks were also pressured as investors dumped exporters on the back of the yen's climb against the dollar. A strong yen hurts Japanese exporters like Toyota Motor Corp. and Sony Corp. by cutting their dollar income from abroad.
The yen stood at 96.47 to the dollar in Tokyo late afternoon Thursday, compared with 97.31 in New York late Wednesday. The euro stood at $1.2802 from $1.2806.
Toyota, the world's largest automaker, fell 3.1 percent to 2,820 yen. Honda Motor Co. dropped 6.6 percent to 2,065 yen.
Sony Corp. was down 3.7 percent at 1,735 yen, and Panasonic Corp. declined 3.4 percent to 1,031 yen.
Miura said investors reacted little to Thursday's release of Japan's revised fourth quarter growth data, which showed the economy contracted slightly less than initially estimated.
Gross domestic product, or the total value of the nation's goods and services, fell at a 12.1 percent annual rate in the October-December quarter, compared with the Cabinet Office's preliminary reading of a 12.7 percent contraction.
The contraction is the severest for Japan since the oil shock of 1974 and is double the pace of the decline in the U.S.
"The revised figure did not change the fact that Japan's economy is mired in a severe downturn," Miura said.


Updated : 2021-05-15 23:38 GMT+08:00