Tokyo stocks close down after three day winning streak

Tokyo stocks closed lower Tuesday as investors locked in profits after three straight days in positive territory, while cautiously assessing the impact of deadly floods and landslides on local economies.

The key Nikkei 225 index fell 0.44 percent, or 99.75 points, to 22,614.69 while the broader Topix index was down 0.34 percent, or 5.44 points, at 1,571.71.

Despite gains in US and European shares overnight, Japanese stocks had a breather as investors took money off the table after three days in the green, brokers said.

Global stock markets rallied again Monday, with fresh signs of an economic recovery resonating with investors more than a surge in coronavirus infections worldwide.

But "there has been nothing to cheer in the latest COVID-19 news, not that that has any bearing on the performance of risk assets at the moment", noted Ray Attrill, strategist at National Australia Bank.

A survey released by Japan's internal affairs ministry early Tuesday showed May household spending in the world's third-largest economy fell 16.2 percent from a year earlier, logging the worst drop since Tokyo began collecting the data in 2000. 

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However, the bad economic news hardly moved Japan's currency, with the dollar trading at 107.47 yen in Tokyo afternoon trade compared with 107.39 yen in New York Monday afternoon.

The impact of the floods and landslides triggered by record heavy rain in western Japan was so far limited.

"But we are closely watching how the disaster will further affect local economies," said Yoshihiro Okumura, general manager at Chibagin Asset Management.
"Anyway, it's not positive news for the market," Okumura told AFP.

In individual stocks trade, Toyota lost 1.29 percent to 6,770 yen and Mazda dropped 3.64 percent to 661 yen after the disaster forced the automakers to close their western Japan plants temporarily.

Uniqlo-operator Fast Retailing lost 1.53 percent to 62,360 yen, but IT investor SoftBank Group surged 4.59 percent to 6,190 yen following gains in shares of companies it has invested in.

Agence France-Presse