Tokyo’s Nikkei index plunges to 15-month low

The Nikkei 225 index closed down 2.84% on Thursday. (AFP pic)

TOKYO: Tokyo’s benchmark Nikkei index plunged to a 15-month low on Thursday amid disappointment over the most recent meeting of the US Federal Reserve which saw the bank raise rates.

The Nikkei 225 index, which at one point had lost more than 3%, closed down 2.84% or 595.34 points to finish at 20,392.58, the lowest since September last year.

The broader Topix index dropped 2.51% or 38.99 points to 1,517.16.

“Market sentiment is really weak,” said Daiwa Securities senior technical analyst Hikaru Sato.

“Trading factors were easily taken as negative,” Sato told AFP.

The Tokyo market opened lower, extending losses in US shares amid worries over the Fed’s pace of monetary tightening, analysts said.

But Ray Attrill, strategist at National Australia Bank, said the post-Fed meeting sentiment was “a bit surprising” given the bank had stressed a “gradual” pace of rate hikes next year.

“The expectation here was that all reference to ‘gradual’ could be dropped,” he said.

In addition to worries over the Fed meeting, “concerns over the slowing of the global economy also weighed on the market”, Okasan Online Securities said in a commentary.

A strong yen also put downward pressure on stocks, according to Daiwa’s Sato.

The dollar fetched 111.92 yen in Asian afternoon trade, against 112.49 yen in New York.

After a volatile session, shares in the mobile phone unit of Japanese technology giant SoftBank rose 1.09% to 1,296 yen after a bruising debut saw stocks close nearly 15% lower.

Nissan dropped 2.19% to 901.3 yen after a Japanese court rejected prosecutors’ request to extend the detention of former Nissan chairman Carlos Ghosn after his arrest for financial misconduct.

Local media said he could now be released as early as Friday.

In other individual stocks, Toyota lost 1.96% to 6,629 yen with Honda down 2.72% at 2,964 yen.