TOKYO, July 7 ― Tokyo stocks closed lower today as investors locked in profits after three straight days in positive territory, while cautiously assessing the impact of deadly floods and landslides on local economies.

The key Nikkei 225 index fell 0.44 per cent, or 99.75 points, to 22,614.69 while the broader Topix index was down 0.34 per cent, or 5.44 points, at 1,571.71.

Despite gains in US and European shares overnight, Japanese stocks had a breather as investors took money off the table after three days in the green, brokers said.

Global stock markets rallied again yesterday, with fresh signs of an economic recovery resonating with investors more than a surge in coronavirus infections worldwide.

But "there has been nothing to cheer in the latest Covid-19 news, not that that has any bearing on the performance of risk assets at the moment”, noted Ray Attrill, strategist at National Australia Bank.

A survey released by Japan's internal affairs ministry early today showed May household spending in the world's third-largest economy fell 16.2 per cent from a year earlier, logging the worst drop since Tokyo began collecting the data in 2000.

However, the bad economic news hardly moved Japan's currency, with the dollar trading at ¥107.47 (RM4.27) in Tokyo afternoon trade compared with ¥107.39 in New York yesterday afternoon.

The impact of the floods and landslides triggered by record heavy rain in western Japan was so far limited.

"But we are closely watching how the disaster will further affect local economies,” said Yoshihiro Okumura, general manager at Chibagin Asset Management.

"Anyway, it's not positive news for the market,” Okumura told AFP.

In individual stocks trade, Toyota lost 1.29 per cent to ¥6,770 and Mazda dropped 3.64 per cent to ¥661 after the disaster forced the automakers to close their western Japan plants temporarily.

Uniqlo-operator Fast Retailing lost 1.53 per cent to ¥62,360, but IT investor SoftBank Group surged 4.59 per cent to ¥6,190 following gains in shares of companies it has invested in. ― AFP