Tokyo stocks erased early gains and closed lower on Monday in sluggish trade, with investors cautious ahead of Japan’s corporate results season.

The benchmark Nikkei 225 index fell 0.77 percent, or 229.33 points, to 29,538.73 while the broader

Topix index lost 0.25 percent, or 4.88 points, to 1,954.59.

Tokyo shares had opened higher as investors took heart from Wall Street rallies propelled by optimistic growth expectations as more people receive Covid-19 vaccines.

But they soon gave up early gains, and closed in negative territory as declines on US stock futures and weak Asian shares dampened buying sentiment.

Analysts said investors were staying on the sidelines before the earnings season gets into full swing.

“Major businesses will start issuing annual corporate results from next week. Before that, the market will lack new cues,” Okasan Online Securities said.

Investors were watching rising Covid-19 infections in Japan, where fresh restrictions came into effect in several places including Tokyo on Monday, as the first elderly citizens got their shots.

The market was also eyeing a summit between US President Joe Biden and Japan’s Prime Minister Yoshihide Suga later this week in Washington.

“We are paying attention to their comments on key topics such as China and vaccines,” Daiwa Securities chief technical analyst Eiji Kinouchi told AFP.

Tokyo investors cheered Japanese golfer Hideki Matsuyama’s victory at the Masters shortly before the market opened. Toyota, whose Lexus brand endorses Matsuyama, rose 0.20 percent to 8,435 yen.

Sumitomo Rubber Industries, which provides the Srixon brand of golf equipment and had its logo featured on a cap worn by Matsuyama, gained 0.60 percent to 1,325 yen.

Uniqlo operator Fast Retailing lost 0.65 percent to 87,310 yen after an NGO alliance in France called for an investigation into Uniqlo and other clothing manufacturers, accusing them of profiting from forced labour of the Uyghur minority in China.

AFP