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TOKYO, Feb 24 ― Tokyo's benchmark stock index closed down more than one per cent today, hit by fears that an expected strong recovery in the global economy will fan inflation.
The Nikkei 225 index slipped 1.61 per cent, or 484.33 points, to 29,671.70, while the broader Topix index was down 1.82 per cent, or 35.28 points, at 1,903.07.
Markets have become jittery over prospects that pandemic recovery will send prices soaring and lead to a hike in lending rates ― especially in the United States, where Congress is moving forward on a US$1.9-billion (RM7.7 billion) stimulus plan.
“The market is increasingly expecting inflation, and higher yields are a negative factor for fast-growing shares such as the IT and high-tech sectors,” said senior strategist Yoshihiro Ito of Okasan Online Securities.
US shares largely recouped early losses yesterday after Federal Reserve chief Jerome Powell tamped down inflation worries, but the tech-rich Nasdaq index closed lower.
“Concerns over interest rates prompted investors to lock in profits” in Tokyo, Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP. “It may take some time for the market to calm down from its recent overheat.”
The dollar fetched ¥105.53, against ¥105.19 in New York late yesterday.
Chip-testing equipment maker Advantest lost 3.30 per cent to ¥9,350, while industrial robot maker Fanuc dropped 4.65 per cent to ¥26,300.
SoftBank Group, which has invested in tech firms and start-ups, dropped 5.20 per cent to ¥9,982.
Sony slumped 5.46 per cent to ¥11,325 on profit-taking with Nintendo down 2.33 per cent at ¥66,440.
Toshiba lost 1.28 per cent to ¥3,455 after a report said the engineering firm is in talks with General Electric about joint production of offshore wind power facilities. ― AFP