Japanese stocks drop over virus concerns, but mergers and acquisitions raise some industrials



TOKYO, April 8 (Reuters) – Japanese stocks fell on Thursday as concerns over an increase in domestic coronavirus infections and a potential return of restrictions on economic activity prompted investors to lock in profits on recent gains.

The Nikkei 225 index was down 0.38% to 29,618.93 at 02:03 GMT, while the broad Topix was down 0.85% to 1,950.57.

The governor of Tokyo plans to adopt emergency measures in response to a sudden increase in coronavirus infections and the spread of a new variant of the virus, according to national media.

The western city of Osaka is also on the verge of declaring a medical emergency after its number of new infections hit an all-time high, raising alarm bells among public health officials.

Reducing restaurant and store opening hours aimed at slowing the infection rate could hamper economic growth. In addition, more and more analysts are starting to worry about the slow pace of the coronavirus vaccination in Japan.

“Japanese stocks could slow relative to other markets,” said Masayuki Kichikawa, chief macro strategist at Sumitomo Mitsui Asset Management Co.

“The markets place great importance on the scale of fiscal stimulus and the vaccination rate. More restrictions would be a negative factor as it would delay a recovery in the consumption of services. “

The worst performers in the Topix 30 were Takeda Pharmaceutical Co Ltd, down 2.85%, followed by Mitsubishi UFJ Financial Group Inc, down 2.41%.

In positive territory, Hitachi Metals Ltd rose 4.36% after Nikkei newspaper reported that a group led by Bain Capital became the preferred bidder for a 53% stake in the company worth around $ 7.3 billion.

Shares of parent company Hitachi Ltd fell 1.03%.

Toshiba Corp rose 1.21% per day after receiving a $ 20 billion offer from CVC Capital Partners to privatize it. In the previous session, Toshiba shares jumped from their daily limit to the highest in more than four years. (Reporting by Stanley White, editing by Sherry Jacob-Phillips)


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