Tokyo stocks close down 0.23pc

August 29, 2014 - 10:19:17 am

TOKYO: Tokyo stocks lost 0.23 percent Friday following a weak slate of Japanese data while investors were also spooked by renewed Ukraine-Russia tensions.

The benchmark Nikkei 225 index eased 35.27 points to finish at 15,424.59, while the Topix index of all first-section shares fell 0.22 percent, or 2.77 points, to 1,277.97.

Shares sank on claims that Russian forces were inside Ukraine helping support pro-Kremlin separatists who have been fighting against Kiev's rule since April. NATO said at least 1,000 Russian troops were on the ground in Ukraine, which Moscow denied.

But tensions eased slightly as Russian President Vladimir Putin called on the pro-Moscow separatists to open a "humanitarian corridor" to allow Ukrainian troops to escape from the rebel-held town of Novoazovsk.

That helped push the dollar up against the yen in afternoon trade, a plus for shares of Japanese exporters.

Investors were also looking to possible details next week on plans to cut Japan's corporate tax rate, a key plank of Prime Minister Shinzo Abe's economic growth plans.

Speculation over Japan's national pension fund boosting its share of domestic equities was another positive.

"Hopes for more government pension fund buying of domestic stocks should keep prices from falling too far," Tsuyoshi Nomaguchi, equity strategist at Daiwa Securities, told Dow Jones Newswires.

Just before the Tokyo market opened, the government released data showing consumer spending dropped and factory production slowed sharply in July, leading to questions about the country's recovery.

In forex trade the dollar clawed back early losses to buy 103.82 yen in the afternoon, up from 103.75 yen in New York.

Shares in electronics firm Pioneer fell 1.52 percent to 323 yen while Sharp rose 0.92 percent to 328 yen following the pair's announcement that they were dissolving a capital tie-up.

Toyota slipped 0.11 percent to 5,928 yen and Canon fell 0.38 percent to 3,399 yen while market heavyweight Fast Retailing eased 0.35 percent to finish at 32,550 yen. (AFP)