Business / Financial Markets | TSE DATA & REPORT

Nikkei falls further in absence of incentives

JIJI

The key Nikkei average lost further ground on the Tokyo Stock Exchange on Thursday amid a dearth of major trading incentives.

The 225-issue Nikkei average sagged 19.09 points, or 0.09 percent, to end at 20,574.63. On Wednesday, the key market gauge dropped 29.19 points.

But the Topix index of all first-section issues closed up 5.57 points, or 0.36 percent, at 1,552.60. It fell 9.40 points the previous day.

Until around midmorning Tokyo stocks were caught in a tug of war between selling to lock in profits and buying on dips, with both indexes fluctuating around Wednesday’s closing levels, market sources said.

After sinking into negative territory toward noon, the Nikkei average failed to become buoyant in the absence of powerful market-moving factors for the rest of the day. Meanwhile, the Topix index went up thanks to solid performances of financial issues, according to the sources.

Brokers said the Nikkei’s fall can be attributed to a sell-off of clothing store chain operator Fast Retailing Co., pointing out that the heavily weighted component issue’s drop pushed the index down by over 50 points.

Hiroaki Kuramochi, chief market analyst at Saxo Bank Securities Ltd., offered the view that the market was weighed down by concerns over U.S.-China trade talks and the prolonged partial government shutdown in the United States.

The day’s market was calm as “investors refrained from tilting their positions significantly ahead of major Japanese firms’ release of their earnings reports later this month,” Kuramochi noted.

“Trading was thin due to the absence of both domestic and foreign institutional investors,” said Chihiro Ota, general manager for investment research and investor services at SMBC Nikko Securities Inc.

Volume edged down to 1.149 billion shares from Wednesday’s 1.151 billion shares.

Despite the continued drop in the Nikkei average, gainers overwhelmed losers 1,419 to 624 in the TSE’s first section while 84 issues were unchanged.

Fast Retailing closed 3.10 percent lower.

Also downbeat were employment information service firm Recruit Holdings Co. and convenience store operator FamilyMart UNY Holdings Co.

By contrast, regional lender Yamanashi Chuo Bank shot up 11.18 percent after announcing its own share buyback plan Wednesday.

Semiconductor-related Tokyo Electron, Advantest Corp., Screen Holdings Co. and Sumco Corp. also attracted buying.

Other major winners included pharmaceutical firm Astellas Pharma Inc. and cosmetics maker Shiseido Co.

In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average stayed unchanged at 20,560 for the second consecutive market day.