Japan share market plummeted to four-month low on Thursday, 13 May 2021, extending losing streak to third session in row on tracking slump on Wall Street overnight, as faster-than-expected rise in consumer prices in the month of April fuelled inflation fears and rekindled concern that the Federal Reserve will be forced to bring forward monetary stimulus tapering sooner than current guidance.At closing bell, the 225-issue Nikkei Stock Average stumbled 699.50 points, or 2.49%, to 27,448.01, below the psychologically important threshold of 28,000 for the first time since Jan. 29. The broader Topix index of all First Section issues on the Tokyo Stock Exchange tumbled 28.91 points, or 1.54%, to 1,849.04.
Total 27 sub-indexes of the 33 sector sub-indexes on the Tokyo exchange traded lower, with Precision Instruments, Information & Communication, Electric Appliances, Services, Mining, Glass & Ceramics Products, and Land Transportation sectors being notable losers, while Pulp & Paper, Rubber Products, Banks sectors were notable gainers.
Tokyo market met with selling from the outset on tracking an overnight slump on Wall Street, as the U.S. Labor Department said on Wednesday that its consumer price index rose 0.8% in April after rising by 0.6% in March, and by 4.2% year-on-year, the fastest pace since 2008. The gyrations in financial markets underscored concerns among some investors that the Federal Reserve could be wrong in its prediction that inflation pressures in the United States are temporary, and that the central bank may have to raise rates sooner than it expects.
Also hurting market sentiment, Japan is struggling to contain the COVID-19 pandemic, forcing dozens of towns to abandon plans to accept overseas athletes competing in the Olympics from July due to concerns about inadequate resources.
Shares of tech and healthcare companies fell sharply, with medical equipment maker Terumo down 4.4%, chip-making machine maker Tokyo Electron losing 4.7% and medical diagnostics products maker Sysmex dropping 4.2%. Semiconductor-related Advantest and TDK dropped 4.9% and 3.1%, respectively.
Shares of retail giant Seven & I soared 5%, following a report that activist U.S. shareholder ValueAct Capital has acquired a 4.4% equity stake in the Japanese company.
Asahi Kasei surged 5.1% after the chemical-maker said on the day that it expects its operating profit for the year ending in March 2022 to grow 10.6%.
CURRENCY NEWS: The U.S. dollar was under pressure in the upper 109 yen range on Thursday. The dollar fetched 109.62-64 yen compared with 109.65-75 yen in New York and 108.79-80 yen in Tokyo at 5 p.m. on Wednesday.
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