Nikkei falls on Hokkaido quake; spotlight on reshuffled benchmark stocks

By Reuters / September 07, 2018 / in.investing.com / Article Link

* Hokkaido Electric tumbles after powerful quake

* Nikkei reshuffle announcement affects some stocks

By Ayai Tomisawa

TOKYO, Sept 6 (Reuters) - Japan's Nikkei fell on Thursday on the back of broad weakness in global equities, while investors awaited damage assessments after a powerful earthquake in Hokkaido, the latest in a series of natural disasters to hit the country this year.

At least one person was killed and 32 were missing after the 6.7 magnitude quake paralysed the northern island, triggering landslides and knocking out power to its 5.3 million residents. A nuclear plant, which had been shut, lost power but no radiation incidents were reported. Electric Power Co 9509.T tumbled 6.4 percent after it said it conducted an emergency shutdown of all its fossil fuel-fired power plants following the quake. Tourism-related stocks were also under pressure, with travel agency operator H.I.S. 9603.T sliding 3.4 percent.

The Nikkei share average .N225 dropped 0.4 percent to 22,487.94, with overall sentiment also depressed by global trade tensions that have put a squeeze on world equities this summer.

The broader Topix .TOPX fell 0.7 percent to 1,692.41. Declining issues outnumbered advancing ones 1,538 to 504.

"On top of a typhoon early this week hitting the Kansai region, the earthquake is stoking concerns of a possible fall in inbound tourism demand and potential damage to businesses," said Shogo Maekawa, a global market strategist at JPMorgan (NYSE:JPM) Asset Management.

Japan began on Wednesday to clean up after typhoon Jebi killed 11 people, injured hundreds and stranded thousands at Kansai Airport, an important hub for companies exporting semiconductors in western Japan.

Nikkei Inc, the operator of the Nikkei benchmark index, also influenced trading with its announcement on changes. Copper smelter Furukawa Co 5715.T dived 9.5 percent after the operator said that it will delete the stock from the index.

CyberAgent 4751.T rose marginally by 0.2 percent, after Nikkei Inc. said it will add its stock to the index.

Nintendo Co 7974.T and e-commerce business operator Start Today 3092.T , which had been expected to be added, stumbled 3.6 percent and 7.2 percent, respectively, while Japan Exchange Group 8697.T stumbled 5.3 percent.

On the other hand, brewer Takara Holdings 2531.T jumped 16 percent, amusement park operator Tokyo Dome Corp 9681.T surged 3.9 percent, Toho Zinc 5707.T advanced 3 percent, as investors bought back after they had sold the shares on speculation that they would be removed from the index.

Companies which benefit from inbound tourism lost ground. Cosmetics makers Shiseido Co 4911.T dropped 1.0 percent and Fancl Corp 4921.T tanked 2.6 percent.

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