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Japanese shares drop on worries about COVID-19 resurgence

06/30/2021 | 11:08pm EDT

TOKYO, July 1 (Reuters) - Japanese shares reversed course to trade lower on Thursday on concerns that a resurgence of COVID-19 infections would lead to an extension of restrictions, slowing economic recovery.

The Nikkei share average fell 0.41% to 28,674.52 by 0200 GMT, while the broader Topix was down 0.34% to 1,936.88.

Japan is considering an extension of two weeks to a month for coronavirus prevention measures in Tokyo and other areas, local media said, as new infections in the country's capital rose to their highest since May 26.

"Investors are holding their bets as they are worried about a resurgence of the coronavirus," said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.

"Shares that gained on expectations for an economic recovery in the past month are losing momentum. But some investors are buying equities which are cheap relative to U.S. peers and that is limiting declines."

Technology stocks led the Nikkei's fall, with start-up investor SoftBank Group losing 1.41%, chip making equipment maker Advantest falling 1.7% and medical equipment maker Terumo dropping 1.42%.

The sea transport sector fell 3.88% and was the biggest loser among the 33 sector sub-indexes on the Tokyo bourse, with Kawasaki Kisen falling 4.76%, Mitsui OSK Lines losing 4.31% and Nippon Yusen declining 3.73%.

Meanwhile, furniture and home improvement goods store operator Nitori rose 2.14% after posting a record quarterly net profit.

Shin-Etsu Chemical advanced 1.51 % and was the top gainer among the top 30 core Topix names, followed by Recruit Holdings, which rose 0.53%.

Seven & i Holdings Co Ltd slipped 2.04% and was the biggest loser on the Topix 30, followed by Mitsui & Co, which fell 1.28%.

The index of Tokyo Stock Exchange's second section fell 0.21% and the Mothers Index of start-up firm shares lost 0.3%.

(Reporting by Junko Fujita; Editing by Aditya Soni)

© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
ADVANTEST CORPORATION 3.16% 8480 Delayed Quote.-22.20%
KAWASAKI KISEN KAISHA, LTD. 4.98% 10750 Delayed Quote.55.35%
MITSUI & CO., LTD. -0.47% 3150 Delayed Quote.15.66%
MITSUI O.S.K. LINES LTD 2.51% 3680 Delayed Quote.29.27%
NIKKEI 225 0.66% 26781.68 Real-time Quote.-7.60%
NIPPON YUSEN KABUSHIKI KAISHA 6.40% 11310 Delayed Quote.29.11%
NITORI HOLDINGS CO., LTD. 0.16% 12750 Delayed Quote.-25.98%
RECRUIT HOLDINGS CO., LTD -1.35% 4400 Delayed Quote.-36.89%
SEVEN & I HOLDINGS CO LTD 0.23% 5262 Delayed Quote.4.07%
SHIN-ETSU CHEMICAL CO., LTD 2.06% 17840 Delayed Quote.-10.44%
SOFTBANK GROUP CORP. 3.43% 5341 Delayed Quote.-1.71%
TERUMO CORPORATION 1.41% 4159 Delayed Quote.-14.42%
TOPIX INDEX 0.52% 1887.3 Delayed Quote.-5.76%
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