Nikkei slips on coronavirus; US stimulus worries after long weekend

Japanese shares eased on Wednesday as the market caught up with the losses in global markets following the country's long weekend, weighed down by fears about rising coronavirus infections and a delay in US fiscal stimulus.

Automakers and other value shares led losses, while gaming companies and internet-related stocks outperformed as worries about the Covid-19 pandemic resurface.

Nikkei share average shed 0.60 per cent on its first trade since Friday to 23,220.33. The broader Topix was down 0.54 per cent at 1,637.48.

"There are worries that coronavirus infections could rise as the temperature cools down. In addition, investors worry about a delay in US stimulus, given that it was the massive economic package that has supported the market," said Fumio Matsumoto, chief strategist at Okasan Securities.

The UK government tightened social restrictions to curb rises in Covid-19 cases, while many US stimulus programmes have lapsed with the Congress unable to clinch another deal.

The anxiety that the economy could suffer from a fresh wave of infections without government support poured cold water on cyclical value shares, such as automakers.

The Topix value lost 1.06 per cent, compared to a slim 0.11 per cent drop in growth shares.

Suzuki Motor lost 4.0 per cent, while Honda Motor and Nissan Motor dropped 3.5 per cent. Isuzu Motors shed 2.8 per cent.

Panasonic fell 3.4 per cent after Tesla Inc CEO Elon Musk said its highly anticipated new low-cost battery could take three years.

On the other hand, investors flocked to stay-at-home winners such as gaming companies. Bandai Namco rose 3.3 per cent and Cyber Agent gained 4.8 per cent.

Internet infrastructure companies also did well, with NTT Data rising 3.4 per cent.

Home furnishing store operator Shimachu was untraded with bids outnumbering offers at the day's limit, up 17.4 per cent, after local media reported rival DCM Holdings was considering a tender offer for the firm.

DCM also rose 13.6 per cent on hopes of consolidation.