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Tokyo stocks close down 1.51%

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(GlobalPost/GlobalPost)

Tokyo stocks lost 1.51 percent Wednesday with risk aversion growing as US forces readied for possible military action against Syria.

The key Nikkei 225 index closed 203.91 points lower at 13,338.46 while the Topix index of all first-section issues fell 1.76 percent, or 19.99 points, to 1,114.03.

The Dow Jones Industrial Average on Tuesday fell 1.14 percent to 14,775.90 as the West moved closer to a strike against Syria in response to its alleged use of chemical weapons against civilians.

Warnings from the United States, France and Britain that Damascus would be held accountable for the August 21 attack sparked market worries of a possible broader conflict.

European stocks also dropped while the price of oil shot up.

The dollar rose to 97.25 yen in afternoon Asian trade from 97.01 yen in New York overnight but well down from 98.29 yen in Tokyo Tuesday.

The euro bought $1.3381 and 130.16 yen compared with $1.3391 and 129.88 yen in US trade.

"The market may yet worsen for Japan shares as US stocks look overbought against the background of Syria tensions, Fed tapering and re-kindling debate over raising the US national debt ceiling, which together pose a threat to stocks," Tachibana Securities market adviser Kenichi Hirano told Dow Jones Newswires.

Dealers are looking for more evidence that the Federal Reserve is ready to pull back on its massive stimulus plan, ahead of its September 17-18 meeting, after minutes from the Fed's last policy meeting gave no clarity on the bank's stance.

In Tokyo trade, Sony dropped 3.43 percent to 1,967 yen while Toyota lost 2.27 percent to 6,020 yen. Fast Retailing, operator of Japanese clothing chain Uniqlo, lost 1.27 percent to 30,900 yen.

bur-si/pst

http://www.globalpost.com/dispatch/news/afp/130828/tokyo-stocks-close-down-151-0