Tokyo stocks open lower as US-Japan trade talks continue

Pedestrians stand in front of a stock indicator displaying numbers of the Tokyo Stock Exchange (top C) and the world’s major markets in Tokyo on August 2, 2018.  / AFP PHOTO / Kazuhiro NOGI

TOKYO, Japan (AFP)–Tokyo stocks opened lower on Friday as investors awaited the outcome of US-Japan trade talks while shrugging off solid Japan growth data.

The benchmark Nikkei 225 index slipped 0.17 percent or 38.99 points to 22,559.40 in early trade while the broader Topix index was down 0.22 percent or 3.82 points at 1,736.34.

“On top of the US-China trade row, Japan-US trade negotiations are underway in Washington, making investors cautious,” said Mutsumi Kagawa, chief global strategist at Rakuten Securities.

After the first round of talks with US Trade Representative Robert Lighthizer on Thursday, Japan’s economy minister Toshimitsu Motegi told reporters: “I think we had good discussions and I’m not pessimistic in any way.”

Motegi said he would announce the outcome after a second day of talks on Friday.

Japan is hoping to win concessions on threatened US auto tariffs, which could pose a threat to the industry if implemented.

“By taking auto tariffs hostage, Washington wants a bilateral free-trade agreement while Tokyo wants a multilateral framework,” Kagawa at Rakuten noted.

The dollar slipped to 110.93 yen from 111.09 yen in New York Thursday afternoon.

Japan’s solid growth data released shortly before the opening bell failed to boost the market.

“It is good that the economy rebounded from its negative growth in the January-March term but it’s about a past quarter,” Kagawa said.

“Looking forward, the effect from trade frictions could cast a shadow,” he said.

Official figures showed the world’s third-largest economy grew 0.5 percent quarter-on-quarter in the April-June period, bouncing back to growth following its first contraction in two years.

In individual stocks trade, Toyota was down 0.15 percent at 6,979 yen while Suzuki rallied 2.95 percent to 7,149 yen after sharp drops the previous day over its admission of improper inspections on some vehicles.

© Agence France-Presse