Japan Nikkei touches 18-month low

Headline indices of the Japan share market extended losses on Tuesday, 11 December 2018, as risk aversion selloff continued amid lingering concerns about the global economic outlook along with skepticism about the potential for a long-term trade deal between the U.S. and China. Meanwhile, fresh Brexit uncertainty also dampened investor sentiments. Total 27 out of 33 issues of Topix index declined, with shares in Oil & Coal Products, Mining, Machinery, Marine Transportation, Metal Products, and Iron & Steel issues being notable losers. In late afternoon trades, the 225-issue Nikkei index dropped 102.79 points, or 0.5%, at 21,116.71. The broader Topix index of all First Section issues on the Tokyo Stock Exchange fell 15.03 points, or 1%, to 1,574.78.

Investor consternation grew following British Prime Minister Theresa May postponing a crucial parliamentary vote, in favor of seeking more assurances from the European Union ahead of a now delayed vote on her Brexit plan. Theresa May will meet European leaders and EU officials later for talks aimed at rescuing her Brexit deal. She will hold talks with Dutch PM Mark Rutte and Germany's Angela Merkel after postponing MPs' final vote on the deal. The UK PM has said she needs "further assurances" about the Northern Ireland border plan to get Commons backing. European Council President Donald Tusk insisted the EU would "not renegotiate" but said leaders would discuss how to help "facilitate UK ratification".

A raft of negative factors cast a shadow on already rattled markets, including soft trade data from China and comments from White House trade adviser Peter Navarro on imposing tariffs on more Chinese imports. China reported weaker-than-expected November exports and imports on Saturday, reflecting slower global and domestic demand, with exports only rising 5.4% from a year earlier, well short of the market expectation.

Among individual stocks, Japanese conglomerate Softbank shares rose 2.5% after the company announced on Monday that shares of its mobile unit IPO would be priced at 1,500 yen apiece (approx. $13.25). Softbank is expected to raise 2.65 trillion yen from the listing (approx. $23.4 billion).

CURRENCY NEWS: The Japanese yen, which can be a haven during market uncertainty, depreciated in the lower-113 yen range against dollar. The Japanese yen traded at 113.12 against the dollar after seeing highs around above 112.2 yesterday.

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