Japan Stocks fall on rising coronavirus cases

Japan stock market finished lacklustre session lower on Monday, 05 July 2021, as risk selloff triggered amid worries about rising cases of the delta variant of the coronavirus and reports that the Japanese government is potentially keeping the quasi-state of emergency covering Tokyo in place during the Summer Olympics.

At closing bell, the 225-issue Nikkei Stock Average was down 185.09 points, or 0.64%, to 28,598.19. The broader Topix index of all First Section issues on the Tokyo Stock Exchange fell 7.32 points, or 0.37%, to 1,948.99.

Trading volume turnover in the 1st section decreased to 774 million shares from 904 million shares in previous session. Trading value turnover decreased to 1,714.43 billion yen from 2,073.38 billion yen in previous session.

Total 21 of 33 sectors sub-indexes on the Tokyo exchange ended lower, with worst performers were Iron & Steel (down 2.6%), Information & Communication (down 1.7%), Pulp & Paper (down 1.6%), Mining (down 1.4%), Rubber Products (down 1.1%), Pharmaceutical (down 1.1%), and Securities & Commodities Futures (down 1.1%) issues, while top gainers were Air Transportation (up 2.2%), Marine Transportation (up 1.1%), Land Transportation (up 0.7%), and Services (up 0.7%) issues.

Investors continue to be spooked after Tokyo confirmed 518 fresh coronavirus cases on Sunday. The Japanese government is reportedly considering extending virus measures in Tokyo until after the Olympics begin on June 23.

Stocks of Japanese conglomerate SoftBank Group plunged 5.4% after Chinese regulators on Sunday claimed SoftBank-backed ride-hailing service Didi illegally collected users' personal data and ordered app stores to stop offering Didi's app.

ECONOMIC NEWS: Japan Services Economy Sees Softer Fall In Business Activity- Japanese services companies continued to report that business conditions were disrupted by the latest wave of COVID-19 infections at the end of the second quarter of 2021. Activity and incoming business experienced further contractions as restrictions introduced to curb the spread of the disease remained in place through much of June. That said, in both cases, rates of decline eased from May. Firms also reported the softest reduction in new export orders since January 2020.

Moreover, service providers were increasingly confident that business conditions would recover in the year ahead. The overall degree of optimism strengthened to the highest since March. The au Jibun Bank Japan Services is compiled by IHS Markit from survey responses from a panel of around 400 service sector companies. The sectors covered include consumer (excluding retail), transport, information, communication, finance, insurance, real estate and business services.The headline figure is the Services Business Activity Index, which tracks changes in the volume of business activity compared with one month previously. A reading above 50 indicates an overall increase compared to the previous month, and below 50 an overall decrease.

The seasonally adjusted Japan Services Business Activity Index rose to 48.0 in June from 46.5 in May, indicating a softer reduction that was modest overall. Service providers highlighted that restrictions continued to hinder activity, however. Similarly, new business inflows fell for the seventeenth month in a row in June. The rate of contraction eased from May and was only marginal.

CURRENCY NEWS: The Japanese yen traded at 111.05 per dollar, stronger than levels above 111.2 against the greenback seen late last week.

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