TOKYO, Dec 20 (Reuters) - Japanese shares closed sharply
lower on Monday after a rate cut in China's lending benchmark
failed to lift investor sentiment while the spread of the
Omicron coronavirus variant continues to stoke worries over an
economic slowdown worldwide.
The Nikkei share average lost 2.13% to close at
27,937.81 in its biggest percentage loss since Nov. 26. The
broader Topix fell 2.17% to 1,941.33.
China cut its lending benchmark loan prime rate (LPR) for
the first time in 20 months, in a bid to prop up growth in the
"China's rate cut was to help improve the economy but
investors were concerned that its growth slowed that much so the
country needed to cut rates," said Ikuo Mitsui, fund manager at
"Investors, who had expected the market to rise towards the
end of the year, also sold stocks as the market is moving to a
Sentiment had already weakened after the U.S. Federal
Reserve said it would accelerate a tapering of its bond-buying
stimulus to end the programme in March.
The Bank of England surprised markets by becoming the first
major global central bank to raise interest rates since the
pandemic hammered the global economy.
Concerns over the impact of the Omicron variant also dented
risk appetite. The Netherlands went into lockdown on Sunday and
the possibility of more COVID-19 restrictions being imposed
ahead of the Christmas and New Year holidays loomed over several
In Japan, all the 33 sector sub-indexes on the exchange
fell, with brokerages leading the decline.
Online financial group SBI Holdings tumbled 6.7% as
an activist investor group sold all of their stake in Shinsei
Bank to SBI, which gained the control of the bank.
The investor could have remained as a shareholder and
demanded SBI to boost Shinsei's value, a market participant
said. Shinsei Bank shares also tumbled 8.36%.
Shares of SBI's peers slipped with Nomura Holdings
losing 5.96% and Daiwa Securities dropping 4.49%.
(Editing by Sherry Jacob-Phillips)