Nikkei hits one-month low as new variant spurs slowdown worries

11/25/2021 | 09:59pm

TOKYO, Nov 26 (Reuters) - Japan's Nikkei slumped on Friday to its lowest level in a month, on worries that a new coronavirus variant found in South Africa could hinder a global economic recovery.

By 0205 GMT, the Nikkei share average dropped 2.3% to 28,829.95, its lowest since Oct. 29, while the broader Topix fell 1.81% to 1,989.03.

For the week, the Nikkei is set to lose 3%, while the Topix is on track to fall 2.7%.

"The market's fundamentals have been weak as investors kept selling when the Nikkei got closer to 30,000," said Kazuharu Konishi, head of equities at Mitsubishi UFJ Kokusai Asset management.

"So, it easily got damaged by negative news, such as the one about new virus variant. Although it might be too rough to conclude that today's declines were only due to the virus."

The variant, detected by scientists in South Africa, may be able to evade immune responses and has prompted Britain to hurriedly introduce travel restrictions on South Africa.

In Japan, heavyweights declined, with Uniqlo clothing store operator Fast Retailing losing 3.13%, technology investor SoftBank Group falling 5.04% and chip-making equipment maker Tokyo Electron slipping 2.62%.

All of Tokyo Stock Exchange's 33 industry sub-indexes were in the red, with airlines and railways leading the declines.

ANA Holdings, falling 3.86%, extended its losses after the airliner raised funds through a sale of convertible bonds.

Railway operator Keisei Electric Railway fell 4.63%.

IHI Corp, losing 5.32%, was the biggest percentage loser on the Nikkei, followed by Pacific Metals, which lost 4.77%.

Sumitomo Osaka Cement surged 10.21%, making it the biggest percentage gainer on the Nikkei, followed by Citizen Watch, which rose 3.26 % and Taiheiyo Cement, gaining 0.97%. (Reporting by Junko Fujita; editing by Uttaresh.V)

© Reuters 2021
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