Tokyo Stocks Likely to Be Vulnerable to Earnings Reports, Trump's Health Update

Tokyo, Oct. 2 (Jiji Press)--Tokyo stocks are expected to be sensitive to earnings reports by Japanese companies and updates on U.S. President Donald Trump's health next week. This week, the benchmark Nikkei average of 225 selected issues listed on the Tokyo Stock Exchange's first section shed 174.72 points, or 0.75 pct, to end at 23,029.90 on Friday. The Nikkei snapped its three-session winning streak Wednesday, as market sentiment was dampened by the chaotic first U.S. presidential debate between Trump and former Vice President Joe Biden. After a full-day trading suspension by the TSE on Thursday, caused by a system glitch, the Tokyo market suffered a plunge Friday, in response to news reports that Trump and his wife, Melania, tested positive for the novel coronavirus and are quarantining themselves. Next week, the Nikkei is expected to move between 22,800 and 23,600, analysts and brokers said. "Market players will be focused on earnings reports to be released," said Maki Sawada, vice president of Nomura Securities Co.'s Investment Research & Investor Services Department. Earnings announcements will be made mostly by retailers next week, including one by Welcia Holdings for June-August due out on Wednesday and another by retail giant Seven & i Holdings for the same period the following day. "The Nikkei is expected to rise on good numbers," Sawada said. Analysts and brokers also said investors will be watching closely over the June-August financial statement by industrial robot maker Yaskawa Electric, regarded as a China-related stock by players, on Friday. Noting that the company's report "will be extremely important to predict" the business conditions of other manufacturers, Sawada said, "Investors will react positively if the report indicates that the Chinese economy is recovering." On the other hand, analysts warned that the Nikkei will fall if companies probe to be still mired in the coronavirus-caused slump. Meanwhile, an official at a midsize securities firm said, "Selling is expected to take the upper hand until Trump's coronavirus test results turn negative." Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management Co., also said, "Participants will also be watching over which side wins Wednesday's U.S. vice presidential debate." END