Tokyo Shares Drop On Inflation Fears, Wall Street Falls
Mohammad Ali (@ChaudhryMAli88) Published May 12, 2022 | 12:17 PM
Tokyo stocks fell in early trade Thursday after overnight drops on Wall Street as investors fret over inflation
Tokyo, (UrduPoint / Pakistan Point News - 12th May, 2022 ) :Tokyo stocks fell in early trade Thursday after overnight drops on Wall Street as investors fret over inflation.
The benchmark Nikkei 225 index fell 1.34 percent, or 350.51 points, to 25,863.13 in early trade, while the broader Topix index gave up 0.79 percent, or 14.59 points, to 1,836.56.
The Dollar stood at 129.58 yen, down from 130.00 Yen seen Wednesday in New York.
Broad selloffs in Tokyo came after US shares soured on increased fears of even faster US tightening as inflation continues to haunt the global economy.
The market continued to focus on the latest US inflation data, which rose at an annual pace of 8.3 percent, higher than the market's expectation for 8.1 percent.
"Inflation might have fallen from the previous high, but the slow pace of the drop will only add to concerns that... the Fed still has a problem with more persistent inflation," Stephen Innes of SPI Asset Management said in a note.
The market is feeling "even more capitulatory" as investors "will have to price a more prolonged Fed hiking cycle".
He also pointed to fears that the Fed may turn more hawkish, and eventually trigger a recession.
The Tokyo market will digest the news of US inflation while also monitoring lockdowns in China, Okasan Online Securities said in a note.
"Inflation worries will likely continue to weigh on the market, especially when the market sees profound risks of supply chain disruptions due to China's lockdowns," Okasan said in a note.
"The Tokyo market is expected to stay soft today." Among major shares, SoftBank Group dropped 5.73 percent to 4,603 yen. The unicorn investor will announce its annual earnings later in the day, with analysts expecting extremely tough figures.
Toyota fell 2.21 percent to 2,036.0 yen a day after announcing record full-year net profit but issuing cautious forecasts.
Uniqlo-operator Fast Retailing fell 4.44 percent to 56,380 yen. Tokyo Electron, which makes tools to build semiconductors, fell 2.55 percent to 53,520 yen.
Toshiba rose 0.98 percent to 5,374 yen amid news that US investor KKR has approached Blackstone to prepare a joint bid for the Japanese engineering company.
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