Tokyo financial markets were rattled Monday by escalating coronavirus fears and plunging oil prices, with the Nikkei ending at a 14-month low and the dollar briefly diving to the mid-101 yen level, its lowest since November 2016.
Oil refiners and trading houses were hit by a sharp fall in crude futures on reports that Saudi Arabia plans to boost oil output after the collapse of Organization of the Petroleum Exporting Countries production limit talks with Russia.
Export-related issues were also battered on the yen's sharp rise against the dollar.
The 225-issue Nikkei Stock Average ended down 1,050.99 points, or 5.07 percent, from Friday at 19,698.76, its lowest close since Jan. 4, 2019. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 82.49 points, or 5.61 percent, lower at 1,388.97.
Every industry category lost ground, led by mining, oil and coal product, and bank issues.
As part of a global market rout, panicked investors in Tokyo unloaded shares and sought perceived safe-haven assets such as the yen and government bonds after the West Texas Intermediate crude futures benchmark for April plunged to $27 per barrel in after-hours trading in New York on Monday, a level not seen in about four years.
Japanese Finance Minister Taro Aso on Monday stressed the need to closely monitor market moves but declined to comment on the possibility of Japan stepping into the foreign exchange market to stem the yen's rise.
"Concerns grew that the plunging oil prices will force energy-related companies to post losses" as fears of a global economic slowdown caused by the coronavirus' spread have seen demand for fuel fall sharply, said Makoto Sengoku, a market analyst at the Tokai Tokyo Research Institute.
"The negative effects of the oil crash hit the market more seriously than the virus," he added.
The Italian government ordered Sunday a large-scale lockdown in the northern part of the country, including Milan, as infection cases in the country surged to over 7,300. The situation also worsened in the United States, with New York state declaring a state of emergency.
"Due to the big falls in oil prices in combination with the virus concerns, the dollar could further fall 2 or 3 yen," said Takuya Kanda, senior researcher at the Gaitame.com Research Institute.
On the First Section, declining issues outnumbered advancers 2,138 to 22, while three ended unchanged.
Oil refiner JXTG plunged 33.50 yen, or 8.2 percent, to 374.00 yen and Japan Petroleum Exploration tumbled 287 yen, or 12.7 percent, to 1,974 yen.
Among trading houses, Mitsubishi shed 128.50 yen, or 4.9 percent, to 2,471.50 yen and Mitsui slid 120.50 yen, or 6.9 percent, to 1,617.00 yen.
Export-related issues such as automakers were hit by the stronger yen, which cuts their overseas profits when repatriated.
Toyota Motor dropped 299 yen, or 4.4 percent, to 6,495 yen, Honda Motor sagged 191.00 yen, or 7.1 percent, to 2,496.50 yen and Nissan Motor slid 34.90 yen, or 8.2 percent, to 389.20 yen.
Trading volume on the main section rose to 2,518.47 million shares from Friday's 1,749.64 million shares.