February 7, 2017 9:16:34 am
Japan’s Nikkei share average dropped to a two-week low on Tuesday morning after global stocks fell and a stronger yen hurt overall sentiment, while Toyota Motor underperformed the market following a worse-than-expected earnings forecast. Investors remained cautious ahead of a meeting between Japanese Prime Minister Shinzo Abe and U.S. President Donald Trump on Feb. 10 and 11, with trade and currencies likely to be on their agenda.
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The Nikkei dropped 0.7 percent to 18,844.68 in midmorning trade, after falling to as low as 18,805.32, the lowest level since Jan 24.
Traders said that investors have become risk averse, with global shares falling overnight on political and economic uncertainties, while a fall in oil prices soured the mood.
In Asian trade, the dollar dropped to 111.625 yen, its lowest since late November as investors sought refuge in the safe-haven Japanese currency.
“Since the dollar-yen dropped its support line, stocks are following suit,” said Kazuhiro Takahashi, an equity strategist at Daiwa Securities.
He said that for the short term, the Nikkei’s downside support is seen at 18,700.
Mining shares declined, with Inpex Corp dropping 1.7 percent and Japan Petroleum Exploration Co declining 0.9 percent.
Oil fell on Monday as ample U.S. supplies and over-extended speculative long positions outweighed bulish factors, notably OPEC output curbs and rising tensions between the United States and Iran.
Toyota Motor Corp underperformed, falling as much as 2.8 percent after its new operating profit forecast undershot market expectations.
The broader Topix dropped 0.4 percent to 1,514.57 and the JPX-Nikkei Index 400 shed 0.3 percent to 13,576.05.
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