TOKYO: Japanese shares ended lower on Monday as the US-Iran peace talks collapsed over the weekend and the American Navy prepared a blockade on Iranian ports, casting fresh doubts about the durability of an ongoing ceasefire.
The Nikkei fell 0.7 percent to close at 56,502.77, after posting last week its steepest weekly gain in more than a year. The broader Topix slid 0.5 percent to 3,723.01.
US President Donald Trump said on Sunday the US Navy would start blocking the Strait of Hormuz, a choke point for 20 percent of the world’s daily energy supplies that Iran effectively closed since the war started in late February. The announcement drove oil prices to jump above USD100 a barrel in early trade on Monday.
“I don’t think there are that many investors who expected everything to be agreed (at the weekend talks) and for everything to go smoothly,” said Shuutaro Yasuda, market analyst at Tokai Tokyo Intelligence Laboratory.
“That said, it’s obviously not good news, so stocks are falling. But I think the reason we’re not seeing a really extreme risk-off move is exactly that.”
Market breadth was negative, with 158 stocks falling versus 63 advancing in the Nikkei.
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