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Tokyo’s Nikkei closes down after 10-day break

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By Agence France-Presse

Tokyo’s key Nikkei index lost more than 1.5 percent on Tuesday following an unprecedented 10-day break, tracking global declines after US President Donald Trump threatened new tariffs on Chinese goods.

The benchmark Nikkei 225 index fell 1.51 percent, or 335.01 points, to close at 21,923.72, while the broader Topix was down 1.12 percent, or 18.09 points, at 1,599.84.

Trump on Sunday vowed to raise tariffs to 25 percent from the current 10 percent on $200 billion in Chinese merchandise by the end of this week, expressing frustration at the pace of US-China negotiations.

“Today’s decline was simply due to trade concern,” said Daiwa Securities chief technical analyst Eiji Kinouchi.

“The concern boosted the yen, which then sent exporters down,” Kinouchi said. “The market has been trapped in a vicious circle.”

Investors are closely watching for any new comments from the US side for clues on whether the administration will make good on the threat, brokers said.

The dollar traded at 110.62 yen in Asian afternoon trade, down slightly from 110.87 yen in New York on Monday but lower than 111.67 yen in Tokyo before 10 days of holidays.

A higher yen against the dollar, in general, weighs on Japanese exporters because their goods are more expensive in foreign markets while their repatriated profits shrink.

In Tokyo, automakers were among the losers, with Toyota down 1.17 percent at 6,824 yen, Honda off 0.77 percent at 3,077 yen and Nissan down 1.71 percent at 878 yen.

Chip-testing equipment maker Advantest dropped 2.22 percent to 3,070 yen after its profit forecasts missed analyst estimates.

SoftBank Group was down 0.77 percent at 11,465 yen after reports it is considering an IPO for its $100-billion Vision Fund.

But Sony rallied 3.76 percent to 5,408 yen after it said annual profits had climbed to record highs for the second consecutive year thanks to a robust performance by its entertainment business.

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