Headline equities of the Japan share market were mixed on Wednesday, 23 January 2019, as signs of slowing global growth and anxiety over a yet-unresolved Sino-US trade dispute offset news of China stimulus and moves in Congress to end the U. S. government shutdown. Around late afternoon, the 225-issue Nikkei index rose 17 points, or 0.1%, at 20,640.25. The broader Topix index of all First Section issues on the Tokyo Stock Exchange fell 5.78 points, or 0.4%, to 1,550.65.
Investors risk sentiments subdued on reports that the U. S. had cancelled a trade meeting with Chinese officials. White House economic advisor Larry Kudlow, however, denied that report, telling that there was never a planned meeting other than the scheduled visit by Chinese Vice Premier Liu He next week. The U. S. and China are aiming to strike a deal to break their trade impasse before March 1.
The two economic powerhouses have been locked in an ongoing trade war since 2018 which has seen both sides slap billions of dollars worth of tariffs on each other's goods.
On Monday, the International Monetary Fund (IMF) in its latest World Economic Outlook has downgraded its global growth forecast for 2019 to 3.5% and 3.6% for 2020 - 0.2% and 0.1% respectively below its previous prediction, citing a bigger-than-expected slowdown in China and the Eurozone, and said failure to resolve trade tensions could further destabilise a slowing global economy. Growth in China last year was the slowest since 1990 and investors are hoping for a breakthrough in US-Sino trade talks, with the tariff dispute between the world's largest economies already rippling through financial markets and global growth.
Shares of Apple supplier Japan Display bucked the trend to surge 10%, before giving up some gains. The stock movements followed reports the company is looking for a bailout after disappointing sales of the iPhone XR. Japan Display supplies the liquid crystal display screens used in the iPhone XR.
ECONOMIC NEWS: Japan had a merchandise trade deficit of 55.286 billion yen in December, the Ministry of Finance said on Wednesday, following the 737.7 billion yen shortfall in November. Exports were down 3.8% on year to 7.023 trillion yen, following the 0.1% gain in the previous month. Imports advanced an annual 1.9% to 7.079 trillion yen following the 12.5% spike a month earlier. The adjusted trade deficit was 183.6 billion yen, following the 492.2 billion yen deficit in November.
CURRENCY NEWS: Japanese yen appreciated against greenback and other major currencies on Wednesday, as concerns about slowing global growth and US-Sino trade tensions drove investors away from risky assets. The Japanese yen, widely seen as a safe-haven currency during times of market turmoil or economic stress, pushed up slightly at 109.39 against the greenback after seeing lows above 109.5 in the previous session. The euro, meanwhile, fetched 124.27-31 yen against 124.23-33 yen in New York and 124.23-27 yen in late Tuesday afternoon trade in Tokyo.
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