Japan's Nikkei Slips To Bear Market


The 225-issue Nikkei Stock Average ended down 1,010.45 points, or 5.01 percent, from Friday at 19,155.74, the lowest level since April 2017.

Sony lost 294 yen, or 5.6 percent, to 5,000 yen and Panasonic slid 54.20 yen, or 5.6 percent, to 920.00 yen.

"Investors rushed to buy stocks thinking they won't fall lower than this", said Maki Sawada, vice president of the investment research and investor services department at Nomura Securities Co., referring to the index's fall the previous day below the psychologically important 20,000 line for the first time in 15 months.

"Investor sentiment improved to some extent" on the back of the strong US market, traced partly to the announcements of brisk USA retail sales data for the holiday season, an official of a bank-linked securities firm said.

The tumult in Washington added to the troubles of investors, who have seen equities worldwide tumble on concerns about a slowing US economy, the pace of the Fed's rate hikes and the ongoing trade war.

US Treasury Secretary Steven Mnuchin had also raised market concerns by convening a crisis group amid the pull-back in stocks.

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In New York, US shares fell sharply with investors unnerved by weekend reports that US President Donald Trump had asked about the possibility of firing Federal Reserve Chairman Jerome Powell. Investors are preparing for more pain.

"The markets are in panic mode that the USA economy is tanking, expecting the benefit of Trump's fiscal stimulus will falter in 2019", said Stephen Innes, head of Asia-Pacific trade at OANDA. So I think it's a tremendous opportunity to buy. Demand for the safety of government bonds increased as investors have grown increasingly nervous about the political outlook in the United States in addition to concerns about a global economic slowdown.

"They're raising interest rates too fast because they think the economy is so good", Trump said.

"The Trump bubble, which has brought gains in U.S. stocks and the dollar, is collapsing", said Mitsushige Akino, an executive officer at Ichiyoshi Asset Management in Tokyo.

Markets may be overreacting, Japan's Finance Minister Taro Aso said, adding that he's not overly anxious. It gained 171.32 points Wednesday.