Stocks lost ground again Friday, pressured by a rise in the yen and position-adjustment selling ahead of the three-day weekend.
The Nikkei 225 average lost 126.37 points to end at 14,201.57, following Thursday’s loss of 174.41 points.
The Topix shed 11.23 points to finish at 1,183.03 a day after losing 10.24 points.
The market got off to a moderately higher start as Thursday’s favorable corporate earnings reports drew buying for individual stocks.
But the market soon lost steam as the yen firmed against other major currencies, dragging the Nikkei into negative territory.
Currencies and stocks are interacting with each other, with weaker stock prices putting further upward pressure on the yen, which again weighs on equities, brokers said.
In addition to some futures-led selling, position adjustment pushed the Nikkei down as investors moved to close positions ahead of the three-day weekend, market sources said. The TSE will be closed Monday for Culture Day.
Investors continued to look into a flood of corporate earnings reports for the half-year period through September for trading clues, giving feedback to individual stocks on the market.
Amid mostly selective earnings-based trading, uncertainty over the course of the U.S. Federal Reserve’s monetary policy weighed on the market, an official at a major brokerage said.
“Although the previous market consensus was for the Fed to start tapering in March next year, now we cannot rule out the possibility of a December tapering,” given the outcome of the Federal Open Market Committee meeting this week, Yutaka Miura, senior technical analyst at Mizuho Securities Co., said.
Losers exceeded winners 1,467 to 230 in the first section, while 58 issues were unchanged.
Volume dwindled to 2.727 billion shares from Thursday’s 2.815 billion.
Sony came under heavy selling pressure and plunged 11.13 percent, after the company revised down its full-year earnings projections.
Japanese government bonds erased earlier losses Friday thanks to weaker Tokyo stocks, but they still lacked strength.
The lead December futures contract on 10-year JGBs closed unchanged at 145.07 after briefly dropping to 144.99 in early trading. Volume increased to 17,578 contracts from 16,447 Thursday.