Tokyo Shares Slip By Noon
TOKYO, Jan 6, (UrduPoint / Pakistan Point News - 06th Jan, 2017 ) - Tokyo shares drifted lower Friday morning as a stronger Yen weighed on sentiment and after Wall Street fell. Exporters faced pressure from the dollar's fall, while Toyota declined after US President-elect Donald Trump fired off a tweet threatening the company with tariffs over a plant it is building in Mexico.
The US Currency was trading at 115.81 yen around noon, up from its earlier low of 115.07 yen, but sharply down from 118.12 yen seen on Wednesday. A stronger yen hurts the profitability of Japan's major exporters, hitting demand for their shares.
Investor sentiment was also affected by overnight declines on Wall Street, where the Dow Jones Industrial Average lost 0.2 percent. The Nikkei index had lost 0.40 percent or 78.51 points to 19,442.18 by the lunch break, slightly off its earlier low.
The broader Topix index of all first-section issues declined 0.39 percent, or 6.08 points, to 1,549.60. "There looks like there's some further downside to go for the Dollar with the bears wrestling control from the bulls who've enjoyed this one-way traffic since Trump was elected," Chris Weston, chief market strategist at IG told Bloomberg news.
The greenback surged against the yen in the weeks after Trump's victory on expectations he will implement expansionary fiscal policies that are seen as pro-growth. Toyota shares dropped, as did other automakers, after Trump's tweet threatened the company with import taxes if it pushed ahead with a project to build a new factory in Mexico.
Toyota fell 2.04 percent to 6,905 by noon, after dropping as much as 3.10 percent a few minutes after the opening bell. In a statement issued after the tweet, Toyota said it looked forward to "collaborating with the Trump administration" and argued that the new Mexican plant will not affect its production or jobs in the US.
Nissan dropped 1.79 percent to 1,178, while Honda fell 1.54 percent to 3,514. Sony, meanwhile, added 0.97 percent to 3,328, while Panasonic dropped 0.62 percent to 1,211.5. Mitsubishi UFJ Financial Group fell 1.46 percent to 737.4. Brokerage Nomura Holdings declined 1.58 percent to 696.6.