TOKYO – Tokyo’s key Nikkei index tumbled more than 3% today, following a rout on Wall Street as rising bond yields in the US and elsewhere stoked inflation fears.
Shortly after the open, the Nikkei was down 3.03% or 913.44 points at 29,254.83, while the broader Topix was down 2.28% or 43.98 points at 1,882.25.
“Equities are starting to quiver on the outlook for higher rates with losses led by the tech sector,” Tapas Strickland, senior analyst at National Australia Bank, said in a note.
The dollar was higher, changing hands at ¥106.35 in early Asian trade, against ¥106.25 in New York and ¥105.89 in Tokyo late yesterday.
“Japanese shares are seen as dominated by sell-orders as investors were discouraged by sharp falls in US stocks,” senior strategist Yoshihiro Ito of Okasan Online Securities said in a note.
The plunge in Tokyo comes after Wall Street stocks ended sharply lower, with the Dow dropping 1.8% to 31,402.01, retreating from an all-time high set Wednesday.
Stocks had been under pressure as investors monitored the 10-year Treasury yield, which has been rising sharply in recent days and got as high as 1.61% yesterday.
Investors fear a spike in inflation will prompt the US Federal Reserve to shift away from easy-money policies and quickly raise interest rates – despite central bank assurances to the contrary. – AFP, February 26, 2021
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