Japan Nikkei falls on profit booking

Headline indices of the Japan share market closed down after erasing early gains during late afternoon trade on Monday, 08 April 2019, as investors elected to withdraw profit off the table following recent gains. Meanwhile, yen appreciation against greenback also fuelled selloff. At closing bell, the 225-issue Nikkei Stock Average fell 45.85 points, or 0.21%, at 21,761.65. The broader Topix index of all First Section issues on the Tokyo Stock Exchange dropped 5.61 points, or 0.35%, at 1,620.14.

Total 24 subsectors out of 33 subsectors of the Tokyo Stock Exchange declined, whereas remaining 9 subsectors closed down, with shares in Insurance, Marine Transportation, Nonferrous Metals, Banks, and Transportation Equipment issues being notable losers, whereas Mining, Oil & Coal Products, Real Estate, and Electric Power & Gas issues were notable gainers.

Tokyo shares opened higher, encouraged by gains on Wall Street after positive March US jobs data. The Labor Department reported that the US added 196,000 net new positions last month, well above expectations, while the jobless rate held steady at 3.8%. But profit-taking emerged in the afternoon as concerns over the US-China trade talks grew.

On US-China trade news front, U.S. and Chinese officials were said to have discussed draft agreement text on contentious issues such as technology transfer, protection of intellectual property rights, and the bilateral trade balance, among others.

President Donald Trump's top economic adviser says the U.S. and China are closer and closer to a trade deal, and that top-tier officials would be talking again this week via a lot of teleconferencing. High-level U.S. and Chinese officials met on the heels of discussions in Beijing the previous week. Chinese negotiators, led by Vice Premier Liu He, and their U.S. counterparts discussed the text of an agreement regarding technology transfers, intellectual property protections, non-tariff measures, services, agriculture, trade balance and enforcement. The White House released a statement Friday evening saying that significant work remains, and the principals, deputy ministers, and delegation members will be in continuous contact to resolve outstanding issues.

On the Brexit front, British Prime Minister Theresa May continues to face challenges in securing a deal for her country that is agreeable with Parliament. The U.K. is set to bow out of the European Union later in April unless May is able to secure another extension of the deadline for Britain.

Shares of China-linked companies were lower with construction machine maker Komatsu dropping 0.9% to 2,816 yen and industrial robot maker Fanuc down 0.7% at 20,830 yen. Nissan lost 0.8% to 936.3 yen after its shareholders voted to eject Carlos Ghosn, its detained former chairman, from the board.

Financial stocks were down on profit booking, with Mitsubishi UFJ Financial Group falling 1.2%, Sumitomo Mitsui Financial Group shedding 1.1% and Dai-ichi Life Holdings sliding 1.5%.

Chip equipment makers were also in the red, with Tokyo Electron shedding 1.4% and Shin-Etsu Chemical slipping 1.2%.

Shares of energy companies attracted buyers after oil prices rose to five-month highs on OPEC's ongoing supply cuts as well as U.S. sanctions against Iran and Venezuela. Inpex Corp rose 1.7% and Japan Petroleum Exploration Co gained 0.8%.

On economic news front, Japan posted a Current Account surplus of 2,676.8 billion Yen in the month of February, up from 600.4 billion Yen of surplus registered the previous month, the country's Ministry of Finance said. Exports were down 1.9 percent on year to 6,307.0 billion Yen, while imports dented 6.6 percent to 5,817.8 billion Yen. That brings the trade surplus to 489.2 billion Yen up from 964.8 billion-Yen deficit in the previous month.

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