Japan stocks edge lower as COVID-19 woes weigh on sentiment

TOKYO, Dec 18 (Reuters) - Japanese shares inched lower on
Friday as investors fretted over the risks that surging COVID-19
cases in Tokyo could pose to recovery prospects in the world's
third-largest economy.
The Nikkei share average .N225 lost 0.19% to 26,756.89 by
the midday break, while the broader Topix .TOPX was nearly
flat at 1,791.84 ahead of a central bank policy decision. Both
the indexes, however, were on track to post weekly gains.
The Japanese capital Tokyo raised its COVID-19 alert level
to the highest of four stages on Thursday as the number of new
cases spiked to a record daily high of 822. The market was also wary of a stronger yen against the
dollar, which last sat at 103.32 yen JPY= after falling as far
as 102.88 yen overnight.
But market losses were capped by a strong Wall Street
performance overnight, said Masahiro Ichikawa, chief market
strategist at Sumitomo Mitsui DS Asset Management.
All three major U.S. stock indexes closed at record highs on
growing optimism about a coronavirus stimulus bill. .N
Nearly two-thirds of the 33 sector sub-indexes on the Tokyo
exchange traded higher. Nonferrous metals .INFRO.T led
advancers on the main bourse, boosted by investor expectations
of rising demand for electric vehicle batteries.
Sony Corp 6758.T gained the most among the top 30 core
Topix names, up 2.89% after hitting its highest since October
2000 on stay-at-home demand.
Among individual decliners, Toyota Motor 7203.T fell 0.84%
as investors chose to book profits after it rallied to the
highest level since August 2015 in the previous session.
Investors now look to the Bank of Japan's policy decision,
though some analysts say market reaction would be relatively
muted.
The central bank is expected to extend a package of steps
aimed at easing corporate funding strains caused by the
coronavirus, while keeping interest rates steady. The Mothers Index .MTHR of start-up firm shares lost
0.23%, after hitting its highest level in 1-1/2 week earlier in
the session.