TOKYO, March 12 — Tokyo’s benchmark Nikkei index closed down 4.41 per cent today after the coronavirus outbreak was declared a pandemic and US President Donald Trump announced a ban on travel from mainland Europe.
The Nikkei 225 index fell 856.43 points to 18,559.63, losing more than 10 per cent so far this week.
The broader Topix was down 4.13 per cent, or 57.24 points, to end at 1,327.88.
Following the World Health Organisation’s pandemic announcement, “concerns over recession due to a contraction in various economic activities intensified”, said Rikiya Takebe, senior strategist at Okasan Online Securities.
The key Nikkei index temporarily lost more than five per cent after Trump banned all travel from Europe to the US for a month to fight the coronavirus, ramping up fears the global economy will careen into recession.
“Panic selling continued,” said Toshikazu Horiuchi, a broker at IwaiCosmo Securities.
“It’s hard to see a short-term bottom for shares now,” he told AFP.
The index recovered slightly after Bank of Japan governor Haruhiko Kuroda held talks with Prime Minister Shinzo Abe and voiced support for financial markets hit by the outbreak.
“We will provide ample liquidity and make appropriate purchases of assets to deal with these economic uncertainties and market movements so that the market and the economy will be stabilised,” Kuroda told reporters.
A strong yen, which is a positive factor for Japanese exporters, also weighed on the market, brokers said.
The dollar fetched 103.65 yen in Asian afternoon trade, against 104.54 yen in New York late yesterday.
“It’s neither a financial problem nor a geopolitical matter. It’s a major virus issue — a factor the market has hardly experienced before,” Shinichi Yamamoto, a broker at Okasan Securities in Tokyo, told AFP.
In Tokyo, exporters and banks were among losers.
Sony slipped 4.27 per cent to 5,882 yen, with Toyota dipping 3.45 per cent to 6,309 yen, while Mitsubishi UFJ Financial plunged 5.46 per cent at 418.4 yen with Sumitomo Mitsui Financial down 5.52 per cent at 2,794.5 yen. — AFP
