Nikkei slides on virus curbs, uncertainty ahead of U.S. Senate runoffs

TOKYO, Jan 5 (Reuters) - Japanese shares slid on Tuesday as
the government looks set to declare a state of emergency to deal
with rising COVID-19 infections while uncertainty about Senate
runoffs in the U.S. state of Georgia also curbed investors' risk
appetite.
Nikkei share average .N225 dipped 0.37% to 27,158.63,
while the broader Topix .TOPX ticked down 0.19% to 1,791.22,
both indexes marking their third straight session of losses.
"There is little reason to buy hastily today ahead of the
runoff in Georgia," said Yuya Fukue, trader at Rheos Capital
Works.
The elections will determine who will control the Senate,
and thereby how much U.S. President-elect Joe Biden can push
through Democrats' agenda, including rewriting the tax code,
boosting stimulus and infrastructure spending. Airlines .IAIRL.T and train operators .IRAIL.T were
among worst performers in the Tokyo Stock Exchange's 33 industry
subindexes, falling 1.2% and 1.5% respectively, on the prospects
of fresh curbs to contain the health crisis.
Local media reported earlier in the day that Japanese Prime
Minister Yoshihide Suga told a ruling party meeting a state of
emergency declaration for Tokyo and the surrounding area would
be decided on Thursday. Tokyo Disney Resort operator Oriental Land 4661.T dropped
2%.
Carmakers .ITEQP.T fell 1.2% as the yen's gains against
the U.S. dollar could chip away their profit from exports.
The yen strengthened to 102.715 per dollar JPY= on Monday,
its highest in nearly 10 months.
On the other hand, many technology shares maintained their
firmness as the COVID-19 pandemic worsened in many countries.
Sony 6758.T rose 1.3% to reach a 20-year high while Tokyo
Electron 8035.T surged 2.6% to a record high. Internet firm Z
Holdings 8604.T gained 3.5%.
The Bank of Japan on Monday reduced the size of its buying
in exchange traded funds to 50 billion yen ($485.91 million),
compared with about 70 billion yen in recent months. But the
market already took the cut in its stride.

($1 = 102.9000 yen)