/ |

Nikkei edges down as overseas bourses fall

JIJI

Stocks skidded lower Friday, dampened by weak U.S. equities and index futures-led selling.

The Nikkei 225 average closed down 35.27 points, or 0.23 percent, to close at 15,424.59 on the Tokyo Stock Exchange. On Thursday, the key market gauge sagged 74.96 points. The Topix lost 2.77 points, or 0.22 percent, to end at 1,277.97, after falling 5.18 points the previous day.

Selling outpaced buying from the outset of Friday’s trading on the heels of overnight falls in U.S. and European stocks.

The Nikkei average extended losses in midmorning trading due to unwinding of arbitrage positions linked to index futures, brokers said.

In the afternoon, stock prices cut losses thanks to buying on dips after the yen dropped moderately against other major currencies, brokers said.

Still, position-adjustment selling prior to the weekend in Japan, as well as the three-day weekend in the U.S., weighed down the key indexes. The New York market will be closed on Monday for Labor Day.

Disappointing readings of Japanese economic data released just before the opening bell, including industrial production in July, “worsened investor sentiment,” said Hideyuki Ishiguro, senior strategist at Okasan Securities Co.’s Investment Strategy Department.

The Nikkei briefly slipped below the key resistance line of its 25-day moving average, which stood at 15,399.22 as of Thursday.

However, “the market attracted some purchases from investor belief that stock prices are undervalued,” said Hideyuki Suzuki, head of the investment market research department at SBI Securities Co.