Tokyo stocks close marginally down

April 21, 2014 - 10:22:33 am

TOKYO: Tokyo stocks ended marginally lower on Monday, giving up early gains that were fuelled by a weak yen after data showed the trade deficit surged year-on-year to $14 billion in March.

The Nikkei 225 index edged down 3.89 points to 14,512.38, while the Topix index of all first-section shares was off 0.17 percent, or 1.97 points, at 1,171.40.

"Market players cashed in on the early gain in late trading, which sent the Nikkei into negative territory," said Kenzaburo Suwa, strategist with Okasan Securities.

"But recoveries are quite likely for the rest of the week as we will have several major events" including the Japan-US summit, Suwa said.

"Also, a corporate result season is to begin this week, which may encourage players to chase selective shares showing positive results," he added.

The market was also weighed down as diplomatic sparring between China and Japan intensified over the weekend.

The Shanghai maritime court seized a large freight vessel owned by Japan's Mitsui O.S.K. Lines in a dispute over what the Chinese side says are unpaid bills relating to the 1930s.

Tokyo on Monday warned that the seizure threatened ties with China and could undermine the basis of their diplomatic relationship dating back to 1972.

The government said early Monday that its trade deficit surged last month to $14 billion, with a weak yen compounding surging imports as consumers rushed to buy before a rise in sales tax.

The poor data sent the yen lower, shoring up export shares.

A weak yen is good for Japanese exporters, making their products more competitive overseas and inflating the value of their repatriated earnings.

The greenback fetched 102.53 yen in Tokyo afternoon trading, up from 102.46 yen Friday, while the euro was up at 141.67 yen from 141.46 yen.

Trading has been thin since last week, with most leading financial markets around the world closed Friday and Monday for Easter.

In Tokyo trade, Toyota ended up 0.10 percent at 5,570 yen and Panasonic was up 0.89 percent at 1,123 yen. Sony closed unchanged at 1,932 yen after giving up earlier gains.

Mitsui O.S.K. Lines tumbled 1.11 percent to 355 yen. (AFP)