CORRECTED-Japanese stocks drop as Wall Street slides on virus resurgence fears

(in 11th para, deletes erroneous reference to the number of
companies that have reported earnings so far)
SYDNEY, May 13 (Reuters) - Japanese shares dipped further
from a two-month high on Wednesday, tracking overnight losses on
Wall Street on fears of a second wave of COVID-19 infections,
while some profit taking also weighed on the market.
The benchmark Nikkei average .N225 fell 0.5% to 20,267.05,
with cyclical sectors leading the declines.
Traders said some profit booking was inevitable sooner or
later because of the recent rally. On Monday, both the Nikkei
and the Topix climbed to their highest levels since March 6.
Wall Street's all three major indexes dropped about 2% on
Tuesday following a warning from Dr. Anthony Fauci, the top
infectious disease expert in the United States, that premature
moves to reopen the economy could lead to a second wave of cases
and set back economic recovery. .N
Investors also kept a watch on simmering U.S.-China tensions
after a leading U.S. Republican senator proposed legislation
that would authorize President Donald Trump to impose sanctions
on China if it fails to give a full account of events leading to
the virus outbreak. The broader Topix .TOPX pared most of the early losses and
ended the session at 1,474.69, just 0.1% lower on the day.
Analysts suspected the Bank of Japan's exchange-traded fund
(ETF) buying, as part of its stimulus programme, buoyed the
market in the afternoon.
About two-thirds of the 33 sector sub-indexes on the Tokyo
exchange finished in negative territory.
Highly cyclical iron and steel .ISTEL.T , insurance
.IINSU.T and air transport .IAIR.T sectors were among the
worst performers in the main bourse.
"COVID-19 has had a significant impact on broad businesses,
regardless of industry," said Keiichi Ito, chief quant analyst
at SMBC Nikko Securities.
"Among companies which already announced earnings results,
about 60% of them have suspended full-year profit guidance,
compared with 10% usually."
Shiseido Co Ltd 4911.T tumbled 4.2% after its net profit
plunged by 95.8% in the January-March quarter and as the
cosmetics maker withdrew full-year profit and dividend guidance,
citing COVID-19 uncertainty.
Toyota Motor Corp 7203.T , the biggest Japanese company by
market value, lost 2.2% following the automaker's warning that
its operating profit will slump almost 80% in the current
financial year through March 2021. Bucking the overall weakness, NEC Corp 6701.T jumped 6.5%
to a 2-1/2-month high after the electronics maker surprised
investors by raising its annual dividend forecast.