Japanese shares eye worst week in nearly 1 year on economic slowdown concerns

TOKYO: Japanese shares fell on Friday, and are on track to post their worst weekly drop in nearly a year, on worries about a slowing economic recovery after Japan declared a fourth state of emergency to counter the resurgence of COVID-19 infections.

The Nikkei share average fell 2.24% to 27,488.25 by 0215 GMT, falling below the 28,000 mark for the first time since June 21. The broader Topix dropped 1.92% to 1,883.38.

The Nikkei has lost 4.5% this week, its biggest weekly decline since July 31.

Japan on Thursday declared emergency measures that will run throughout the Olympics, forcing the organisers to hold the Games without spectators.

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"Investors are concerned whether Japan's fourth emergency measures would really work economies in other countries are reopening but Tokyo is still under the emergency measures, with the Olympics to be hosted without fans" said Takatoshi Itoshima, strategist at Pictet Asset Management.

Also pressuring markets, Wall Street indexes pulled back from record closing highs overnight in a broad sell-off.

In Japan, shares fell across the sectors, with shippers leading declines with a 4.4% drop.

Restaurant operator Global-Dining lost 3.29% as the government is planning to take stricter measures against eateries that do not comply with the order to shorten business hours.

The company earlier this year had filed a lawsuit against the Tokyo government claiming its order to close restaurants was illegal and not based on scientific evidence.

Eisai edged up 0.57% as its partner Biogen said the US Food and Drug Administration has narrowed use of its Alzheimer's drug, after the agency drew sharp criticism for its initial approval of the drug.

All the stocks on the top 30 core Topix names fell, dragged down by Nidec, which fell 4.32%, and Daikin Industries , which lost 4.28%.