Japanese stocks fall amid weak support for new PM
TOKYO, Oct.6 (Reuters) – Japan’s Nikkei average reversed course on Wednesday to its lowest level in more than two months, amid concerns over the impact of the Chinese debt crisis, while Japanese Prime Minister Fumio Kishida’s modest approval ratings disappointed investors.
The Nikkei stock average fell 0.97% to 27,551.00 at 02:21 GMT, reaching its lowest since August 20 after rising 1.4% earlier in the session. The larger Topix lost 0.25% to 1,942.93.
“Japanese stocks rebounded earlier in the session, but the gains weren’t as big as investors had expected, prompting them to start selling stocks,” said Seiichi Suzuki, analyst in head of stock markets at the Tokai Tokyo Research Institute.
Heavyweights led the declines, with clothing store operator Uniqlo Fast Retailing losing 2.36%, technology investor SoftBank Group falling 1.23% and robot maker Fanuc falling 2.22%.
A local media poll showed Kishida struggled to find her place with voters just two days after her election and the launch of her new government. One daily showed his approval rating to be 45%, far lower than that of the administration of his predecessor Yoshihide Suga when he took office last year.
“This means Kishida’s party is unlikely to win a landslide victory in the next general election,” said Kentaro Hayashi, senior strategist at Daiwa Securities.
Kishida’s plans to raise capital gains tax could lead to massive sales as they want to lock in profits before taxes rise, Hayashi said.
Kishida, during his first press conference as prime minister, said this week that changing the country’s financial income tax rate would be among the options to address income disparities.
Sumitomo Osaka Cement advanced the most on the Nikkei, rising 13.21%, followed by Taiheiyo Cement, which gained 7.2% and Pacific Metals Co Ltd, up 5.39%.
Mitsubishi Motors lost the most on the index, falling 7.55%, followed by Takeda Pharmaceutical, losing 6.25% and Kawasaki Kisen Kaisha, down 4.48%. (Reporting by Junko Fujita; Editing by Krishna Chandra Eluri)