Nikkei flat as coronavirus resurgence in Europe hits sentiment

Japan’s Nikkei share average was nearly flat on Friday as new coronavirus curbs in Europe dimmed hopes of a global economic recovery, although gains in Fast Retailing after it forecast upbeat annual earnings helped to cap losses.

The benchmark Nikkei share average was little changed at 23,523.37 by the midday break, with 80 advancers on the index against 137 decliners. The broader Topix lost 0.28 per cent to 1,627.14.

Both the indexes were set to post weekly losses.

All but ten of the 33 sector sub-indexes on the Tokyo exchange traded lower, with real estate, pharmaceuticals and land transport leading the decline on the main bourse.

The sentiment was weighed down by the introduction of new coronavirus restrictions in Europe, with London entering a tighter lockdown and France imposing night curfews in major cities to curb a jump in Covid-19 cases.

Some investors also remained on the sidelines due to uncertainty over the US stimulus talks, and ahead of the US presidential election and earnings reports from domestic firms.

The Nikkei, however, was supported by index heavyweight Fast Retailing, which jumped more than 4.4 per cent after the retailer forecast a stronger-than-expected surge in operating profit this business year.

The stocks that gained the most among the top 30 core Topix names were Astellas Pharma Inc up 1.28 per cent, followed by Hitachi Ltd.

The underperformers among the Topix 30 were Sony Corp down 2.13 per cent, followed by Takeda Pharmaceutical Co Ltd losing 1.90 per cent.

The Mothers Index of start-up firms lost 0.64 per cent, on course to snap four consecutive weekly gains.