Japan Nikkei tumbles on fears over US financials

Japan share market finished deeper into sea of red on Monday, 13 March 2023, as risk-averse mood spurred amid contagion fears after the failure of US regional lender Silicon Valley Bank.

The 225-issue Nikkei Stock Average index tumbled 311.01 points, or 1.11%, to finish at 27,832.96. The broader Topix index of all First Section issues on the Tokyo Stock Exchange dropped 30.59 points, or 1.51%, to 2,000.99.

Total 31 of 33 TSE sectors ended lower along with TOPIX index, with Banks, Insurance, Insurance, Securities & Commodities Futures, Pulp & Paper, and Other Financial Business issues being notable losers.

Tokyo market hit by hefty selling across financial related stocks after all three key U.S. stock indexes tumbled last Friday in the wake of the collapse of Silicon Valley Bank, seen as the largest bank failure since the 2008 financial crisis in terms of asset holding.

U.S. regulators said on Sunday that they would take control of the bank to take emergency measures guaranteeing all deposits in an apparent attempt to prevent a broader financial crisis. They also said they have shut down New York-based Signature Bank, which had come under pressure in recent days, and announced the protection of all deposits.

ECONOMIC NEWS: Japan Large Manufacturers' Confidence Weakens Sharply In Q1-- Japan large manufacturers' sentiment posted a sharp deterioration in the first quarter, the business outlook survey published by the Ministry of Finance showed on Monday. The business survey index of large manufacturers fell to -10.5 in the March quarter from -3.6 in the preceding period. At the same time, the BSI for large non-manufacturers slid to +0.6 from +2.7 in the prior period. However, the index is expected to improve to +1.4 in the coming quarter. Consequently, the BSI for overall large manufacturers dropped to -3.0 from +0.7 in the fourth quarter of 2022. Manufacturers anticipate conditions to improve next quarter, with the score rising again to +0.7.

CURRENCY NEWS: The U.S. dollar traded in the upper 133 yen level around late afternoon in Tokyo after briefly falling to a one-month low in the mid-133 yen range earlier in the day amid concern that the collapse of Silicon Valley Bank would spread to other financial institutions. The dollar fetched 133.85-86 yen compared with 135.05-15 yen in New York and 136.40-43 yen in Tokyo on Friday.

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