Tourism shares drag down Nikkei amid China-Japan spat over Taiwan
By Junko Fujita
TOKYO, Nov 17 (Reuters) - Japan's Nikkei share average fell in choppy trade on Monday, as tourism-related stocks tumbled amid an escalating diplomatic spat with China over Taiwan.
The Nikkei .N225 was down 0.5% at 50,135.31, as of 0218 GMT, after rising as much as 0.4% earlier in the session. The broader Topix .TOPX fell 0.67% to 3,337.38.
China on Friday cautioned its citizens against visiting Japan in the spat sparked by comments from Japanese Prime Minister Sanae Takaichi.
Takaichi said this month that a Chinese attack on Taiwan could amount to a "survival-threatening situation", potentially triggering a military response from Tokyo.
Shares of department stores fell, with Isetan Mitsukoshi Holdings 3099.T down 10.87%. Takashimaya 8233.T lost 6.52%, while cosmetics maker Shiseido 4911.T fell 9.5%. Uniqlo-brand owner Fast Retailing 9983.T lost 5.5% to become the biggest drag on the Nikkei.
"Market reaction to those stocks was a little bit too much. Investors might have priced in all the bad news regarding the relationship between China and Japan," said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.
"I do not think the sell-off of those stocks would continue."
Lending some support to the market, technology stocks rose as investors scooped up chip and artificial intelligence-related shares on dip.
SoftBank Group 9984.T gained 3% to become the biggest support for the Nikkei. Fujikura 5803.T, a maker of fibre optic used at AI data centres, rose 2%, while Mitsui Kinzoku 5706.T, a maker of data centre materials, jumped 7%.
Sumitomo Mitsui Financial Group 8316.T rose 3.8% after the country's second-largest banking group posted a 57% rise in July-September quarter net profit on Friday.
Mitsubishi UFJ Financial Group 8306.T and Mizuho Financial Group 8411.T slipped 1.5% and 0.32%, respectively, even as they posted higher quarterly net profits.
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