The Tokyo stock market lost 0.70 percent on Monday in thin trading following weaker-than-expected Japanese GDP data.
The benchmark 225 Nikkei index closed down 95.76 points to 13,519.43, while the Topix index of all first-section shares fell 0.55 percent, or 6.29 points, to 1,134.62.
The Nikkei got off to a weak start, slipping 1.14 percent at the open as Tokyo published Japan’s latest quarterly economic growth figures.
The growth data showed that the world’s third-largest economy expanded 0.6 percent for the three months to June from the previous quarter, slower than a revised 0.9 percent rise in the January-March period and missing analyst expectations.
The Nikkei temporarily recovered in midday trade as the yen weakened, but ended in negative territory with questions swirling about whether Prime Minister Shinzo Abe would go ahead with a planned sales tax hike in the face of an uncertain recovery.
Some fear the rate hikes, aimed at paying down Japan’s huge national debt, would stall Abe’s bid to stoke the world’s third-largest economy.
“The market remains divided over the tax hike plan,” said Kenzaburo Suwa, strategist with Okasan Securities.
“If Abe goes ahead with the planned tax hike, consumption will be dampened for sure, and if he does not, Abe’s political leadership will be under question.”
The GDP data Monday came as many Japanese traders go on an annual summer holiday, known as “Obon”, which saw trading thinner than usual.
Camera maker Nikon was down 2.25 percent to 1,687 yen. Its shares plunged nearly 15 percent Friday after the firm said profit dived 72 percent in the latest quarter, warning that compact camera sales were falling through the floor as consumers increasingly turn to picture-taking smartphones.
In other trade, Uniqlo clothing chain operator Fast Retailing was down 1.10 percent to 31,300 yen, All Nippon Airways was flat at 206 yen while Sony fell 0.56 percent to 1,932 yen.
On forex markets, the dollar bought 96.48 yen, strengthening from 96.24 yen in New York on Friday and 96.05 yen after the GDP data were published Monday morning.
Tokyo shares close down 0.70%
