Tokyo shares open lower ahead of state of emergency

TOKYO: Tokyo stocks opened lower on Wednesday as the Japanese government prepared to issue a fresh state of emergency to fight the surging coronavirus, with players also eyeing elections in the US state of Georgia.

The Nikkei 225 index fell 0.13 percent, or 35.46 points, to 27,123.17 in early trade, while the broader Topix index edged down 0.03 percent, or 0.56 points to 1,790.66.

Overnight gains on Wall Street were encouraging, but the yen's strength continued to weigh on the Tokyo market, analysts said.

The Japanese currency stood at 102.61 yen in Tokyo, against 102.72 yen overnight in New York.

"The market may try to use the momentum from the US market and attempt to regain ground that was lost earlier, but the continued strength of the yen is a cause for concern," Okasan Online Securities said.

"With the US elections, and ahead of a state of emergency (in part of Japan), investors may become inclined to take a wait-and-see attitude," the brokerage said, expecting the market to spend the day without a clear sense of direction.

Polls closed for the US Senate runoff elections that will determine the balance of power in Congress as trading began in Tokyo.

Last-minute surges in polls by the Republican candidates lifted Wall Street, as their victories would mean higher hurdles for policy moves by the next Democratic administration, including possible tax hikes and tougher industry regulations, analysts said.

Meanwhile, eyes in Tokyo are on the government as it prepares to declare a state of emergency on Thursday that will focus largely on bars and restaurants in the greater Tokyo region to fight the fast spread of coronavirus infections.

Officials have said the measure will be "focused" and "limited" and reports suggest it will last about a month.

Among major shares, SoftBank Group added 1.22 percent to 8,118 yen. Toyota rose 0.45 percent to 7,847 yen.

Some high-tech issues suffered. Advantest, the world's top builder of semiconductor testing tools, fell 1.98 percent to 7,940 yen. Tokyo Electron, which makes tools to build semiconductors, fell 1.00 percent to 38,490.

Sony dipped 0.19 percent to 10,550 yen.