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Tokyo stocks drop nearly 2% at open after Wall St tumble

Oct 11 2018 07:39

Tokyo - Tokyo stocks dropped nearly 2% at the opening on Thursday following a plunge in New York, as US traders fretted about surging interest rates and the safe-haven yen climbed against the dollar.

The benchmark Nikkei 225 index was down 1.94% or 457.03 points at 23 049.01 in early trade, while the broader Topix index was down 1.90% or 33.49 points at 1 730.37.

Both indexes later extended losses, sinking by more than 3% during morning trade.

Traders would be avoiding risk-taking after the drop on Wall Street and a higher yen, strategist Yoshihiro Ito of Okasan Online Securities said in a commentary.

US shares plunged as worries about surging US interest rates and the impact of trade disputes prompted a broad-based selloff that slashed more than 3% from major indices.

US Treasury Secretary Steven Mnuchin warned China on Wednesday against engaging in competitive currency devaluations as the two countries wage a trade war, in comments published in the Financial Times.

There are several factors behind the recent fall in the Chinese currency, including economic issues in China, Mnuchin told the newspaper ahead of meetings in Bali, Indonesia of the IMF, World Bank and G20.

"As we look at trade issues there is no question that we want to make sure China is not doing competitive devaluations," Mnuchin told the FT.

The dollar fetched ¥112.11 in early Asian trade, down from ¥112.35 in New York and ¥113.00 in Tokyo late on Wednesday.

Blue-chip exporters tumbled widely, with Olympus plunging 4.17% at ¥4 245, Toyota off 3.07% at ¥6 552, and Sony down 4.97% at ¥6 242.

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equities  |  currency  |  markets  |  tokyo stocks
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