TOKYO, July 7 (Xinhua) — Tokyo stocks closed lower Wednesday due to the weak performance of the energy sector caused by a drop in crude oil futures and sluggish export-related issues on the appreciation of Japanese yen.
The 225-issue Nikkei Stock Average decreased 276.26 points, or 0.96 percent, from Tuesday to reach 28,366.95.
The broader Topix index of all First Section issues on the Tokyo Stock Exchange ended 16.82 points, or 0.86 percent, lower at 1,937.68.
On the First Section, declining issues outnumbered increasing ones 1,709 to 415, while 67 finished the day unchanged.
Trading volume on the main section continuously increased to 1,066.53 million shares from Tuesday’s 794.25 million and Monday’s 774.29 million.
Except for precision instrument sector, shares of mining, oil and product and insurance led the fall on Wednesday and all other sectors lost ground.
After the underperformed U.S. non-manufacturing data dragged down investor sentiment over the prospects for the U.S. economy, many Asian markets including Japan’s ended the day lower.
Although business activities in the services sector marked a growth rate of 60.1 percent in June, up for the 13th straight months, the figure fell from a record high in May and were weaker than the market expectation, said the Institute for Supply Management.
Kazuo Kamitani, a strategist in the Investment Content Department of Nomura Securities Co, said “negative sentiment was fueled further by a drop in U.S. crude oil futures and Treasury yields.”
Energy-related issues fell with the drop of crude oil futures in New York, which hit the highest level in six years and eight months. The market has been fluctuating following a standoff over production levels among the Organization of the Petroleum Exporting Countries and other major oil producers.
Inpex slipped 3.7 percent, and Cosmo Energy Holdings dropped 2.2 percent.
Following the release of underperformed growth in services sector, the U.S. dollar fell to the mid-110 yen range since the yen was expected to be a safe-haven asset.
The appreciation of the yen pulled down export-related shares, with Toyota Motor dropping 0.6 percent and Sony Group declining 1.0 percent.