Tokyo stocks open flat after global sell-off
The broader Topix index of all first-section shares eased 0.17 percent, or 2.18 points, to 1,266.19
TOKYO (AFP) - Tokyo stocks opened flat on Wednesday following a sharp sell-off on US and European markets on fears over a slowdown in global economic growth.
World equity markets were hit on Tuesday by weak economic indicators in Europe and a warning by International Monetary Fund chief Christine Lagarde that developed economies need to ramp up fiscal stimulus to prevent a backwards slide in the global economy.
The strong risk-off mood pushed the yen higher against the dollar in US trade.
The yen changed hands at 110.54 per dollar in Asian trade from 110.28 in New York. The Japanese currency briefly rallied below 110 in US trade, erasing most of its weakness since the Bank of Japan in October 2014 expanded its monetary stimulus programme.
A stronger yen makes Japanese goods more expensive overseas and hits repatriated profits, denting the bottom line of some of the country s biggest firms.
The benchmark Nikkei 225 index at the Tokyo Stock Exchange edged down 5.12 points to 15,727.70 in opening deals, following a loss of more than two percent the previous day.
The broader Topix index of all first-section shares eased 0.17 percent, or 2.18 points, to 1,266.19.
Lagarde hinted in Frankfurt that the IMF will cut its current 2016 global growth forecast of 3.4 percent next week when it publishes a fresh outlook ahead of its spring meeting with the World Bank in Washington.
"Today will be a tug of war, but stocks probably won t decline too much," Chihiro Ohta, general manager of investment information at SMBC Nikko Securities, told Bloomberg News.
"Investors are concerned about the global economy again and are turning to risk-off as the IMF may downgrade its growth forecasts."
On Wall Street, the Dow closed 0.8 percent lower on Tuesday, while the S&P 500 and the Nasdaq both lost 1.0 percent.
In Europe, Frankfurt and Paris each fell more than two percent, while London was 1.2 percent off.
