Tokyo shares open lower on Trump surge

Tokyo shares open lower on Trump surge

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Tokyo shares opened lower on Wednesday, following global sell-offs sparked by a new poll that put Republican candidate Donald Trump slightly ahead of his Democratic rival in the US presidential race.

“The Trump risk is in revival,” said Chihiro Ohta, a Tokyo-based senior strategist at SMBC Nikko Securities Inc, told Bloomberg News.

“With Trump, there always follows an uneasiness over whether policies will be managed properly in the US, and given the holiday tomorrow in Japan, there’s no need to build positions at an uncertain time like this.”

An ABC News/Washington Post tracking poll found Trump edging ahead of Democratic rival Hillary Clinton—by one point—for the first time since May.

Other surveys have shown Clinton clinging to a narrowing lead less than a week before the November 8 vote.

Clinton has been largely seen as more favourable to investors, who generally value policy stability.

The benchmark Nikkei 225 index lost 1.20 percent, or 209.47 points, to 17,232.93 in the first few minutes of trading, while the Topix index of all first-section issues was down 1.28 percent, or 17.84 points, to 1,375.35.

The new poll that favoured Trump injected fresh anxiety into US and European equity markets on Tuesday.

In currencies, the dollar fell against the yen on risks of a Trump win, trading at 104.04 yen early Wednesday against 104.82 when the Tokyo market closed on Tuesday.

A stronger yen eats into Japanese exporters’ profitability and usually pulls down the equities market.

On the Tokyo stock market, trading in shares of pharmaceutical maker Takeda was suspended after media reports that it is in discussion with Valeant over acquisition of its Salix stomach drugs business.

The Wall Street Journal reported Valeant is in “advanced talks” with Takeda on the sale for about $10 billion, reports AFP, TOKYO.

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