Markets News

Nikkei ends lower ahead of earnings rush, Mitsubishi Motors slumps

* Trade slow with upcoming earnings in focus

* Mitsubishi Motors plummets 12% after dismal earnings

TOKYO, July 28 (Reuters) - Japanese shares ended lower on Tuesday as investors maintained a cautious stance ahead of corporate earnings, while Mitsubishi Motors plunged to an all-time low after the carmaker posted dismal quarterly numbers.

The Nikkei share index fell 0.26% to 22,657.38, while the broader Topix lost 0.48% to 1,569.12.

The index initially was buoyed by a rebound in U.S. technology shares on hopes of more fiscal stimulus from Washington.

Languid trade provided a tailwind in the afternoon, however, with many investors on the sidelines ahead of a peak in Japanese earnings announcements this week and next.

The market was also weighed down by coronavirus worries as Tokyo registered 270 new COVID-19 cases.

Among the companies that announced quarterly results on Monday, Mitsubishi Motors tumbled 12.64% to a record low after the carmaker posted dismal sales in its key Southeast Asian market and forecast a huge loss for this financial year.

Nissan Motor fell 4.63% following a Bloomberg report that cited the automaker will forego annual dividend this fiscal year.

The automaker, which has an alliance with Mitsubishi Motors, is due to announce its earnings after market close.

While the coronavirus crisis has hammered the global auto industry, “Japanese automakers have been doing relatively well”, said Hisashi Arakawa, deputy head of investment management at Aberdeen Standard Investments in Tokyo.

“However, Mitsubishi Motors was already facing many business challenges even before the pandemic hit,” he said, noting that the earnings results and the company’s decision to forego dividend payment may have also caused the stock price to decline.

Hitachi Construction dropped 6.23% after its disappointing April-June earnings.

On the other hand, Koei Tecmo Holdings jumped 13.45% to a record high after the video game company reported brisk profit growth.

Stanley Electric added 4.38% after the automobile lamps manufacturer gave a stronger annual outlook than expected. (Reporting by Hideyuki Sano, Eimi Yamamitsu; Editing by Jacqueline Wong and Sherry Jacob-Phillips)