Sell Off Drives Nikkei Under 17,000 Mark

Stocks came under heavy selling Tuesday amid risk-averse sentiment stemming from tumbling crude oil prices, driving down the Nikkei average below 17,000 for the first time in about three weeks.

The Nikkei 225 average plunged 525.52 points, or 3.02 percent, to 16,883.19, closing below the psychologically important 17,000 for the first time since Dec. 17. It was the largest single-day point loss since February 2013. On Monday, the key market gauge retreated 42.06 points.

The Topix lost 39.95 points, or 2.85 percent, to end at 1,361.14 after shedding 6.42 points Monday.

Both indexes extended their losing streak to a fourth session.

 
The TSE tumbled from the outset after the Dow Jones industrial average suffered its steepest one-day point fall in three months on Monday. The Dow’s plunge came after the benchmark West Texas Intermediate crude oil futures contracts dropped below $50 per barrel for the first time in about five years and eight months.

The Nikkei accelerated its downswing in late trading, driven by unwinding of arbitrage positions linked to index futures on the back of the yen’s strengthening against the dollar, brokers said.

Several technical charts indicate Tokyo stocks have been oversold, brokers said. The Nikkei has shed over 900 points in the four sessions through Tuesday.

via Japan Times

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