TOKYO, April 1 (Xinhua) -- Tokyo stocks tumbled Wednesday on the first day of the new fiscal year amid concerns over downbeat U.S. economic data and the Bank of Japan's (BOJ) Tankan survey as a result of the coronavirus pandemic.
The 225-issue Nikkei Stock Average dropped 851.60 points, or 4.50 percent, from Tuesday to close the day at 18,065.41.
The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, fell 51.96 points, or 3.70 percent, to finish at 1,351.08.
Local brokers said trading got off to a cagey start, with stocks here tracking their U.S. counterparts lower, with gloomy consumer sentiment data for March in the United States punctuating the rising global economic impact of the coronavirus pandemic.
A Bank of Japan (BOJ) survey released on Wednesday showed that large manufacturers' business confidence turned negative in March for the first time in seven years, which added to a risk-off mood.
The BOJ's Tankan survey's sentiment index for large manufacturers plummeted to minus eight from zero in the recording period, marking its lowest level since the same reading was logged in March 2013. The central bank forecast a glib outlook as manufacturers worldwide shutter operations, with supply chains being severely disrupted owing to the pandemic.
In addition, the index, henceforth, is also likely to reflect concerns over falling global and domestic consumption, and a possible decline in domestic economic activities if further restrictions on people's movements are imposed. The survey has amplified recession concerns of the world's third-largest economy.
"The market was weighed down as all manufacturers and non-manufacturers, regardless of their sector or size, have seen a worsening outlook," Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co., was quoted as saying.
A pervasive risk-averse mood in later trade saw investors flee to safe havens, including the Japanese yen, which pushed its value up against the U.S. dollar and weighed on exporter issues, market players said.
As for currency moves, Japanese exporters typically rely on a weaker yen to boost profits made when repatriated from overseas and increase competitiveness in overseas markets. The yen's rise against its counterparts, as was the case Wednesday, has the opposite effect and can lead to exporters' profit outlooks and guidance being downwardly revised, investment analysts highlighted.
The U.S. dollar hit the lower 107 yen level in the afternoon, while at 5 p.m., was quoted at 107.64-67 yen compared with 107.51-61 yen in New York and 108.41-43 yen at 5 p.m. on Tuesday in Tokyo.
The euro, meanwhile, fetched 1.0959-0961 dollars and 117.98-118.02 yen against 1.1033-1043 dollars and 118.59-69 yen in New York and 1.0996-0998 dollars and 119.21-25 yen in late Tuesday afternoon trade in Tokyo.
Additionally, equity strategists said that despite Japanese Prime Minister Shinzo Abe on Wednesday saying that declaring a state of emergency was not imminent, market concerns remained rife that lockdowns to varying degrees may still be imposed as COVID-19 infections continue to rise nationwide, particularly in Japan's urban areas.
According to health ministry officials and local governments, as of 6:30 p.m. local time on Wednesday, 2,362 people have been infected with the pneumonia-causing virus, with 66 new cases confirmed in Tokyo. The overall death toll has now risen to 78 nationwide, the latest figures showed.
"The threat of a lockdown is looming and we don't know how long the economic slowdown will continue," Makoto Sengoku, a market analyst at the Tokai Tokyo Research Institute, said.
The lockdown concerns saw domestic-demand driven issues come under pressure, with East Japan Railway dropping 5.3 percent as concerns mount that people's movements will be restricted if a state of emergency is declared and citywide lockdowns imposed.
Defensive issues were also sold, including NTT DoCoMo, which closed the day 6.6 percent lower and Kao Corp., which slumped 6.3 percent.
As both in and outbound travel restrictions have become increasingly strict, airlines lost ground Wednesday, with Japan Airlines diving 4.6 percent, while ANA Holdings tumbled 8.3 percent.
By the close of play, all industry categories retreated into negative territory, with air transportation, service and rubber product issues comprising those that declined the most.
Issues that fell trounced those that rose by 2,056 to 100 on the First Section, while 10 ended the day unchanged.
On the main section on Wednesday, 1.661 billion shares changed hands, dropping from Tuesday's volume of 1.862 billion shares.
The turnover on the third trading day of the week came to 2,720.5 billion yen (25.29 billion U.S. dollars).
