Tokyo stocks closed sharply lower Friday with the benchmark Nikkei index falling nearly 3 percent to its lowest level since mid-June as selling spread across the board on a stronger yen and weak earnings amid the coronavirus pandemic.
The 225-issue Nikkei Stock Average ended down 629.23 points, or 2.82 percent, from Thursday at 21,710.00. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 43.41 points, or 2.82 percent, lower at 1,496.06.
All industrial categories were down, led by rubber product, marine transportation and mining issues.
In the currency market, the U.S. dollar weakened to around 104.20 yen, its lowest level in more than four months, after data showed overnight that the U.S. economy shrank by a record 32.9 percent in the April-June quarter in annualized terms due to the pandemic.
Japanese finance officials, including those from the Bank of Japan and the Finance Ministry, met Friday to discuss response to market development. A stronger yen undermines the price competitiveness of Japanese exports and reduces profits earned abroad when repatriated.
Tokyo shares extended losses throughout the day, also affected by the continued rise in coronavirus cases at home and abroad as well as sluggish earnings from companies hit by the pandemic.
The daily count of new infections in Tokyo reached 463, a record for a second straight day, with the cumulative total in the city standing at more than 12,000.
The recent uptrend in the capital forced Gov. Yuriko Koike to request Thursday that establishments serving alcohol as well as karaoke parlors again close early to curb the spread of the virus.
The rising infections are "diminishing hopes for early economic recovery," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co., adding that weak growth in major economies as well as the sluggish performance of domestic companies "reminded investors of how serious the viral damage is."
On the First Section, declining issues outnumbered advancers 2,032 to 134, while 7 ended unchanged.
Advantest hit a limit-down 1,000 yen, or 14.9 percent, finishing at 5,700 yen after the chip-testing device maker reported Thursday a weaker-than-expected net profit for the first quarter ended in June.
As the rising yen hit exporters, Honda Motor skidded 141 yen, or 5.3 percent, to 2,524 yen, Yamaha Motor sagged 92 yen, or 5.7 percent, to 1,535 yen, while Mitsubishi Motor was down 11 yen, or 5.1 percent, at 206 yen.
Trading volume on the main section rose to 1,678.99 million shares from Thursday's 1,300.42 million shares.© KYODO