TOKYO, March 3 (Xinhua) -- Tokyo stocks closed lower Tuesday, relinquishing early gains on Wall Street's rally, as the mood turned risk-averse on concerns that the Group of Seven countries (G7) may not put forward a detailed, collaborative response to limit the global economic fallout from the COVID-19 epidemic.
The 225-issue Nikkei Stock Average lost 261.35 points, or 1.22 percent, from Monday to close the day at 21,082.73.
The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, fell 20.75 points, or 1.36 percent, to finish at 1,505.12.
Trading got off to a bright start in Tokyo advancing 1.7 percent at the outset, following an upbeat lead from Wall Street overnight including the Dow Jones Industrial Average logging its biggest point gain in history on hopes central banks will roll out measures to stabilize markets, settle volatility and underpin economies amid the spread of the coronavirus.
But local brokers said that gains were erased as investors became unsettled about the outlook for the global economy amid concerns the G7 will not release a statement in the next day or two detailing a collaborative plan to combat the potential economic fallout from the coronavirus epidemic.
"Investors were quick to sell their shares after expectations waned that major countries would swiftly team up in fighting off the virus threat, which orchestrated the Dow's overnight spike," said Yutaka Miura, senior technical analyst at Mizuho Securities Co.
On the domestic front, some investors were concerned about Japan's predicament in particular, as the country has been shortlisted by the World Health Organization (WHO) who stated it is now one of four countries that it is most concerned about.
Excluding more than 700 cases of infections and five deaths stemming from the quarantined Diamond Princess cruise liner, infections in Japan have topped 200, with six people having died as a result of the virus.
"I remain worried about the downside risks for Japanese stocks because the virus is still spreading in Japan. There are expectations on the policy front, but if this is not backed up with big fiscal stimulus and monetary easing, then this is unlikely to alter the course of the economy," Yutaka Masushima, market analyst at Monex Securities in Tokyo, was quoted as saying.
The yen's rise against the safe-haven yen also weighed on the market and exporters in particular, with the dollar quoted at 108.03-05 yen at 5 p.m., compared with 108.26-36 yen in New York and 108.44-45 yen at 5 p.m. on Monday in Tokyo.
In terms of notable individual movers, securities houses lost ground as financial markets remained turbulent, and Nomura Holdings dropped 2.0 percent, while Daiwa Securities Group lost 2.7 percent.
Among exporters heavily hit, Mazda Motor skidded down 2.4 percent, while Nissan Motor reversed 3.8 percent.
Travel agency H.I.S. tumbled 9.2 percent, after downwardly revising its outlook for the current fiscal year through October, owing to a plunge in tourist numbers due to the spread of the COVID-19.
By the close of play, securities house, farm and fishery and machinery-oriented issue comprised those that declined the most, and issues that declined outpaced those that rose by 1,938 to 189, on the First Section, while 35 ended the day unchanged.
On the main section on Tuesday, 1.764 billion shares changed hands, dropping from Monday's volume of 2.035 billion shares.
The turnover on the second trading day of the week came to 3,071.9 billion yen (28.44 billion U.S. dollars).
