TOKYO, Feb 14 (Reuters) - Japanese stocks dropped on Friday
as renewed worries about a coronavirus outbreak in China
supported demand for the safe-haven yen and weighed on
export-oriented shares.
The benchmark Nikkei average .N225 fell 0.5% to 23,704.59
by the midday break, while the broader Topix .TOPX dropped
0.6% to 1,702.50.
"Until Wednesday, people had been saying that you can buy
shares because the number of new cases had peaked out. The
reality seems to be quite different. An early end to this seems
improbable," said Norihiro Fujito, chief investment strategist
at Mitsubishi UFJ Morgan Stanley Securities.
In its latest update, China's Hubei province health
commission said on Friday that it had recorded 116 deaths and
4,823 new cases of the flu-like virus that emerged in the
provincial capital, Wuhan, in December. Japan, which confirmed its first coronavirus death on
Thursday, is one of the worst affected of more than two dozen
countries and territories outside mainland China that have seen
hundreds of infections from the flu-like sickness.
"Investors will surely avoid Asia for the time being and
will shift funds to the U.S., geographically the most separated
from the region," he said.
That meant more demand for the safe-haven yen JPY=EBS in
the currency exchange market, which serves as a headwind for
Japanese exporters' shares.
All but three of the 33 sector sub-indexes on the Tokyo
Stock Exchange were trading lower, with iron and steel
.ISTEL.T , oil and coal products .IPETE.T and construcion
.ICNST.T becoming the worst three performers.
Nissan Motor Co Ltd 7201.T dived 9.3% after the automaker
cut its annual operating profit forecast by 43%, hit by a slump
in vehicle sales and heaping more pressure on new management to
rebuild the company after Carlos Ghosn's ouster. Bucking the overall weakness, SUMCO Corp 3436.T jumped
7.0% after the semiconductor silicon wafer maker projected its
operating profit for the January-March quarter to fall by 54.6%
year-on-year but said supply-demand conditions for 200mm wafers
are tightening.