Nikkei hits 6-week low as revived U.S.-China trade war sours sentiment

  • Reuters
  • Stock Market News
Nikkei hits 6-week low as revived U.S.-China trade war sours sentiment
Credit: © Reuters.

* Nikkei down 2.11%, Topix falls 2.16%

* Shares with exposure to China hit as trade war flares up

* Exporters also bruised as yen surges on trade woes

By Shinichi Saoshiro

TOKYO, Aug 2 (Reuters) - Japan's Nikkei hit a six-week low on Friday after U.S. President Donald Trump unveiled plans to impose new tariffs on China, reviving trade war concerns and slugging exporter and manufacturing firms.

The Nikkei share average .N225 ended the day down 2.11% at 21,087.16 after going as low as 20,960.09, its weakest since June 18.

Global equity markets were shaken after Trump said on Thursday that he would slap a 10% tariff on $300 billion of Chinese imports from Sept. 1. He added that the tariffs could be raised further if China's President Xi Jinping failed to move more quickly to strike a trade deal. of companies with exposure to China slipped. Industrial equipment makers Komatsu Ltd 6301.T and Hitachi Construction Machinery Co 6305.T fell 2.2% and 4.7%, respectively. Robot manufacturer Fanuc 6954.T lost 3.8%.

"The biggest impact on Japanese shares from an escalation of the trade war comes from its negative effect on the Chinese economy," said Soichiro Monji, senior strategist at Sumitomo Mitsui DS Asset Management.

Exporters also retreated as the safe-haven yen jumped against the dollar on the back of heightened trade tensions. Toyota Motor Corp 7203.T lost 2.3%, Subaru Corp 7270.T fell 2.8% and Panasonic 6752.T retreated 3.5%.

Technology shares sagged after rising last month on views that trade tensions between Washington and Beijing would ease. Tokyo Electron 8035.T dropped 0.7%, TDK Corp 6762.T fell 3.8% and Murata Manufacturing Co 6981.T lost 1.6%.

Sharp Corp 6753.T tumbled 13.7% after the company reported lower-than-expected operating profit in the April-June quarter as the trade war dampened demand for its electronics products. Computer Co 6952.T swam against the tide and rallied 8% after its April-June operating profit rose 13.9% thanks to factors such as brisk sales of its G-SHOCK watches. broader Topix .TOPX lost 2.16% to 1,533.46. Declining shares outnumbered gainers 1,994 to 129.

All 33 of Tokyo's sub-indexes ended the day in the red. (Editing by Michael Perry)

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