SYDNEY, April 16 (Reuters) - Japanese shares on Thursday
tracked overnight losses on the Wall Street, as economic damage
from COVID-19 weighed on investor sentiment, with banks and
automakers leading the declines.
The benchmark Nikkei average .N225 ended 1.3% lower at
19,290.20. The Nikkei's volatility index .JNIV , a measure of
investors' volatility expectations based on option pricing and
considered to be a fear gauge, rose 8.6% to 39.36.
On Wednesday, all three major U.S. stock indexes fell as the
raft of weak economic data and dismal first-quarter earnings
reports compounded concerns over the extent of damage from the
coronavirus pandemic. .N
U.S. retail sales and manufacturing output saw sharp
declines, while disappointing earnings from Bank of America Corp
BAC.N and Citigroup Inc C.N added to worries about weak U.S.
corporate results. Taking a cue from this, Tokyo-listed banks fell, with
Mitsubishi UFJ Financial Group (MUFG) Inc 8306.T , Sumitomo
Mitsui Financial Group (SMFG) Inc 8316.T and Mizuho Financial
Group Inc 8411.T shedding between 2.1% and 3.3%.
The broader Topix .TOPX fell 0.8% to 1,422.24, with
two-thirds of the 33 sector sub-indexes on the Tokyo exchange
finishing lower.
Highly cyclical sea transport .ISHIP.T , transport
equipment .ITEQP.T and non-ferrous metals .INFRO.T were the
worst three performing indexes on the main bourse.
"We have downgraded Japan to a neutral from favour,
reflecting fuller relative valuations and softer fundamentals in
the current global setting," said Natasha Ebtehadj, portfolio
manager at Columbia Threadneedle Investments in London.
"Although, still supported by the long-term structural
improvement story of better corporate governance, Japan is a
strongly cyclical and operationally leveraged market that is
highly exposed to 'sudden stops' in global activity."
Toyota Motor Corp 7203.T slid 2.0% after the carmaker said
it will cut production of finished vehicles at 18 plants in
Japan due to the COVID-19 outbreak. Nissan Motor Co Ltd 7201.T , Honda Motor Co Ltd 7267.T
and Mazda Motor Corp 7261.T lost between 3.8% and 5.2%.
JFE Holdings 5411.T fell 3.3% on news that its unit JFE
Steel will temporarily halt two blast furnaces in western Japan,
potentially cutting 25% of its capacity. Its bigger rival Nippon Steel 5401.T , which announced a
similar plan earlier this month, fell 3.1% to hit its lowest
level in data going back as far as 1973. Bucking the overall trend, the Nikkei's heavyweight SoftBank
Group Corp 9984.T advanced 2.2% after the tech conglomerate
said it re-purchased shares worth 16 billion yen ($148 million)
in late-March. The index of Mothers start-up shares .MTHR climbed 2.7% to
730.88, its highest close since March 5.
($1 = 107.8600 yen)