Tokyo stocks fell 1.61 percent by the close Wednesday, tracking falls on Wall Street and another plunge on China's main index as weak trade data hinted at the fragility of Japan's recovery. But Toshiba shares bucked the downturn, soaring 7.71 percent to 393.9 yen after the scandal-hit conglomerate announced late Tuesday it would appoint a host of renowned Japanese business people as outside directors.
The management shuffle comes after one of Japan's best-known firms was hammered by a billion dollar accounting scandal that uncovered a corporate culture in which top bosses routinely pressured subordinates to inflate profits. At the close, the Nikkei 225 index at the Tokyo Stock Exchange slid 331.84 points to 20,222.63 yen, while the Topix index of all first-section shares lost 1.42 percent, or 23.74 points, to end at 1,648.48. Shortly before the opening bell, official data for July pointed to weakness in Japanese exports as demand falls in China, fuelling concerns about the world's number three economy, which contracted in the second quarter.
Investors remain jittery about China after the benchmark Shanghai index tumbled 6.15 percent on Tuesday, its biggest fall in three weeks. It fell more than five percent earlier Wednesday. "Another big drop in Chinese equities is leading to concern over the Chinese economy - we're lacking reasons to aggressively buy in Japan," SMBC Nikko Securities manager Hiroichi Nishi told Bloomberg News. Tokyo also picked up a weak lead from Wall Street where the Dow Jones Industrial Average lost 0.19 percent following a mixed batch of earnings from retailers including Wal-Mart.
In other trading, automaker Nissan fell 1.19 percent to 1,154 yen while rival Toyota slipped 0.87 percent to 7,897 yen. Market heavyweight Fast Retailing, operator of the Uniqlo chain, was down 1.19 percent to 53,860 yen. On currency markets, the dollar fetched 124.30 yen, edging down from 124.38 yen in New York. A stronger yen is a negative for Tokyo shares as it hurts the competitiveness of Japanese exporters.