The benchmark Nikkei average fell sharply to extend its bear run to a sixth consecutive session on the Tokyo Stock Exchange Wednesday, with investor sentiment dampened by the yen’s rise against the dollar.
The 225-issue Nikkei average plunged 351.69 points, or 1.57 percent, to close at 22,028.32, marking the first six-session losing streak since one through May 6, 2016. On Tuesday, the key market gauge edged down 0.98 point.
The Topix index of all first-section issues finished down 34.86 points, or 1.96 percent, at 1,744.01, after falling 4.62 points the previous day.
The Tokyo market opened with losses in the wake of Wall Street’s overnight downturn against a backdrop of lower crude oil prices and uncertainties over the course of U.S. tax reform.
Tokyo stocks were unable to rebound, pressured by continued selling to cash in gains following their surge until early last week, brokers said.
In the afternoon, in line with the yen’s firming against the dollar, the market accelerated its downswing due to a flurry of selling apparently by nonresidents, brokers said. The Nikkei briefly slumped almost 380 points to a level barely above the 22,000 line.
The market “stayed in a correction phase amid a dearth of trading incentives after purchases of issues backed by rosy corporate earnings have run their course,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management Co.
While taking a similar view, Yoshihiko Tabei, chief analyst at Naito Securities Co., said the Nikkei “didn’t fall below 22,000 thanks to buying on dips” throughout Wednesday’s session.
Tabei said that stocks are expected to regain the upward momentum to recover 23,000 if the administration of U.S. President Donald Trump “draws up a new plan to carry out tax reform.”
Ichikawa noted that the market’s downside was supported by hopes for purchases of exchange-traded funds by the Bank of Japan.
Falling issues overwhelmed rising ones 1,901 to 120 in the TSE’s first section, while 14 issues were unchanged.
Volume jumped to 2.16 billion shares from Tuesday’s 1.74 billion shares.
Oil companies Japex, Inpex and JXTG Holdings were downbeat following a fall in crude oil prices.
Also on the minus side were optical equipment manufacturer Hoya and game-maker Nintendo.
By contrast, Showa Denko closed up 2.71 percent after hitting a listing-to-date high of ¥4,170. The industrial materials maker announced Tuesday that its consolidated operating profit for the nine months through September jumped 2.19-fold from a year before to ¥55,944 million.
Other major winners included insurer Dai-ichi Life and auto parts producer Unipres.
In index futures trading on the Osaka Exchange, the key December contract on the Nikkei average plummeted 390 points to 22,040.