Nikkei hits 2-week low as virus, political concerns outweigh Wall Street boost

C.E.Management Integrated Laboratory.Ltd

05/07/2021 07:22

TOKYO, July 5 (Reuters) - Japanese shares slipped on Monday,
with the Nikkei hitting a two-week low, failing to gain a boost
from a Wall Street rally after strong U.S. jobs data, as rising
COVID-19 infections in Japan and elsewhere hurt cyclical shares.
    A disappointing showing by Japanese Prime Minister Yoshihide
Suga's Liberal Democratic Party (LDP) in a local election on
Sunday added to the cautious mood.  urn:newsml:reuters.com:*:nL2N2OG00M
    "The LDP's recovery wasn't strong, leaving concerns about
the upcoming general election," said Nobuhiko Kuramochi, senior
strategist at Mizuho Securities.
    Nikkei share average  .N225  lost 0.64% to 28,598.19, its
lowest close in two weeks, while the broader Topix  .TOPX 
dropped 0.37% to 1,948.99.
    That was a clear under-performance following new record
highs scaled by Wall Street shares on Friday after jobs data for
June showed robust hiring but limited signs of wage inflation.
    Many cyclical shares slumped, led by steelmakers, one of the
most sensitive sector to the global economy on rising concerns
about the Delta variant of COVID-19.
    JFE Holdings  5411.T  lost 4.0%, while Nippon Steel  5401.T 
shed 3.5%.
    Coronavirus cases in Tokyo have been on the rise over the
past fortnight, hitting a five-week high and raising worries the
government may declare its third state of emergency this
year. urn:newsml:reuters.com:*:nL2N2OF066
    Elsewhere, Softbank Group  9984.T  fell 5.4% to seven-month
lows after China's cyberspace regulator ordered smartphone app
stores to stop offering Didi Global Inc's  DIDI.N  app after
finding that it had illegally collected users' personal data.
 urn:newsml:reuters.com:*:nL2N2OG087
    Softbank is a major backer of the Chinese ride-hailing
start-up. 
    On the other hand, some construction firms with strength in
civil engineering gained after landslides triggered by
torrential rains hit the central city of Atami at weekend,
sweeping away 130 buildings.  urn:newsml:reuters.com:*:nL2N2OG01H
    Raito Kogyo  1926.T , a construction firm with expertise in
slope and foundation improvement, rose 1.3%.
    CE Management Integrated Laboratory  6171.T , which offers
geological survey and disaster prevention systems, gained 3.1%.

 (Reporting by Hideyuki Sano; Editing by Shailesh Kuber)
 ((hideyuki.sano@thomsonreuters.com; +81 3 4520 1195;))