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Tokyo stocks erase losses to end flat on hopes for positive earnings

This Oct. 2, 2020 photo shows the Tokyo Stock Exchange. (Kyodo)

TOKYO (Kyodo) -- Tokyo stocks ended almost flat Tuesday as buying on hopes for earnings recoveries from the coronavirus pandemic erased earlier losses.

    The 225-issue Nikkei Stock Average ended down 8.54 points, or 0.04 percent, from Monday at 23,485.80. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 1.45 points, or 0.09 percent, lower at 1,617.53.

    Decliners were led by air transportation and mining issues, while precision instrument, and information and communication issues led gainers.

    The U.S. dollar hovered in the upper 104 yen range ahead of the U.S. presidential election on Nov. 3.

    At 5 p.m., the dollar fetched 104.83-84 yen compared with 104.78-88 yen in New York and 104.87-88 yen in Tokyo at 5 p.m. Monday.

    The euro was quoted at $1.1818-1819 and 123.89-93 yen against $1.1804-1814 and 123.75-85 yen in New York and $1.1833-1834 and 124.09-13 yen in Tokyo late Monday afternoon.

    The yield on the benchmark 10-year Japanese government bond slipped 0.005 percentage point from Monday's close to 0.025 percent as the safe haven debt was bought amid surging coronavirus case counts in the United States and some European countries. Bond yields move inversely to prices.

    Tokyo stocks trimmed earlier losses that tracked sharp falls overnight on Wall Street and in European markets on fears over a resurgence in coronavirus infections.

    "After some positive earnings reports on Monday such as by Canon and Nidec, investors renewed expectations that the Japanese economy is bottoming out," said Shingo Ide, chief equity strategist at NLI Research Institute. "Issues related to upbeat shares also drew buying."

    Canon jumped 144.00 yen, or 8.1 percent, to 1,932.00 yen after revising upward on Monday its profit forecast for 2020 on a gradual pickup in demand for its new digital cameras and printers. Its peer Seiko Epson surged 67 yen, or 6.0 percent, to 1,187 yen.

    Many Japanese firms closing their books in March started releasing their earnings reports for the July-September period this week.

    Among stocks hardest hit by the pandemic, ANA Holdings declined 75.00 yen, or 3.2 percent, to 2,290.00 yen. Just after the market closing, the airline said it expects a record net loss of 510 billion yen ($4.9 billion) in the current business year through March.

    Japan Airlines dropped 87.00 yen, or 4.3 percent, to 1,949.00 yen, following media reports saying it expects to post an operating loss of around 85 billion yen for the three months through September.

    Investor concerns also eased as new COVID-19 infections in Japan have not surpassed levels seen in spring and summer unlike the United States or some European countries, brokers said.

    In Europe, Spain declared a state of emergency on Sunday, while Italy imposed social distancing rules from Monday.

    On the First Section, advancing issues outnumbered decliners 1,190 to 903, while 85 ended unchanged.

    Oil related issues were notably weak amid concerns the coronavirus pandemic will continue to weigh on demand.

    Oil explorer Inpex dropped 16.50 yen, or 3.0 percent, to 528.00 yen. Japan Petroleum Exploration sagged 66 yen, or 3.6 percent, to 1,757 yen, while refiner Cosmo Energy Holdings lost 20 yen, or 1.3 percent, to 1,579 yen.

    Trading volume on the main section rose to 945.34 million shares from Monday's 808.39 million shares.

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