Tokyo stocks track Wall St falls

TOKYO – Tokyo stocks opened lower today, tracking falls on key United States indexes as investors weigh risks linked to yields and await comments from US central bank officials this week.

The benchmark Nikkei 225 index fell 1.31%, or 389.41 points, to 29,402.64 in early trade, while the broader Topix index was down 0.98%, or 19.80 points, at 1,992.41.

“Japanese shares are seen starting with falls as investors were disheartened by weak US markets,” said senior strategist Yoshihiro Ito of Okasan Online Securities in a note.

The Dow and S&P fell on Wall Street, while the tech-rich Nasdaq ended up after investors were rattled by Federal Reserve comments that a temporary rule allowing banks to exclude central bank deposits and Treasury bonds from capital requirements will expire at the end of this month.

It raised fears that banks will dump their bond holdings, causing yields to rise further and constrain borrowing.

Global markets have been facing pressure from rising yields to the 10-year US Treasury bond.

“This week will see several occasions where Fed officials will speak publicly,” said Japanese brokerage Daiwa Securities in a commentary.

“Depending on their comments, yields could rise further.”

The dollar fetched ¥108.88 (RM4.11) in early Asian trade against ¥108.87 in New York late last Friday.

Here, automakers were lower after chip maker Renesas Electronics told local media that a fire at a major domestic plant will impact stable chip supply to customer companies.

Chip supplies are already under pressure globally, with growing demand causing difficulty especially for carmakers.

Honda was down 3.00% at ¥3,367, Toyota was off 1.98% at ¥8,473 and Nissan was down 2.61% at ¥607.8.

Renesas was down 4.15% at ¥1,177 after its president reportedly said yesterday a blaze at one of its nine factories in Japan will likely “have a significant impact” on chip supplies.

It will take about a month for it to resume operations, reported leading business daily Nikkei, citing chief executive Hidetoshi Shibata.

Elsewhere, Panasonic was down 1.72% at ¥1,402, Canon was off 1.08% at ¥2,378.5 and Sharp slipped 1.11% at ¥1,877.

On Wall Street, the Dow ended down 0.7% at 32,627.97. – AFP, March 22, 2021