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The 32-year-old Spaniard, who rides for Honda and claimed the world title in 2010, 2012 and 2015, told a press conference he was pulling out following Sunday's race.
With six races to go, the Spaniard has a comfortable 93-point lead over his closest rival Andrea Dovizioso of Ducati.
The Honda rider, started on the second row, but snatched victory on the final lap from France's Fabio Quartararo, on a Yamaha-SRT, who had the lead for most of the race.