Headline indices of the Japan share market closed down on Tuesday, 22 January 2019, as investors opted to lock in profits amid renewed concerns about the health of the global economy after the International Monetary Fund (IMF) slashed its world economic growth forecast for the next two years, warning of continuing trade tensions between the two nations on global growth, and the possibility of a no-deal Brexit between the UK and the European Union. At closing bell, the 225-issue Nikkei index dropped 96.42 points, or 0.47%, at 20,622.91. The broader Topix index of all First Section issues on the Tokyo Stock Exchange fell 9.94 points, or 0.63%, to 1,556.43.

The International Monetary Fund cut its forecast for the world economy, predicting it will grow at the weakest pace in three years in 2019 and warning fresh trade tensions would spell further trouble. In its second downgrade in three months, the lender blamed softening demand across Europe and recent palpitations in financial markets. It predicts global growth of 3.5% this year, beneath the 3.7% expected in October and the rate in 2018.

Machinery makers which have large exposure to China as well as chip-related stocks lost ground, with Fanuc Corp falling 2.1%, Yaskawa Electric dropping 2.3% and Tokyo Electron shedding 1.8%.

Air-conditioning system maker Totech Corp jumped 10% after it raised its net profit outlook for the year ending March to 3.6 billion yen from 3.2 billion yen.

Panasonic Corp fell 2.7% after reports that Tesla Inc has signed a preliminary agreement with China's Tianjin Lishen to supply batteries for its new Shanghai car factory, as it aims to cut its reliance on Panasonic.

CURRENCY NEWS: Japanese yen appreciated against greenback and other major currencies as demand for safe heaven resumed on global growth slowdown woes after the International Monetary Fund yesterday lowered its global growth forecasts for this year and the next, specifically citing the growth slowdown in China as well as the Eurozone. They further commented that the resolution to the trade tensions was vital in order to prevent further destabilization of the global economies.