Business / Financial Markets | TSE DATA & REPORT

Tokyo stocks turn lower on yen's rise

JIJI

Stocks turned lower on the Tokyo Stock Exchange Wednesday, pressured by the yen’s strengthening against other major currencies.

The 225-issue Nikkei average lost 116.11 points, or 0.53 percent, to end at 21,638.16, after gaining 24.30 points on Tuesday.

The Topix index of all first-section issues closed down 10.30 points, or 0.65 percent, at 1,579.54. It rose 4.99 points the previous day.

The market went south immediately after the opening bell, on the back of the yen’s rises against the dollar and the euro triggered by falls in U.S. and European interest rates after Bank of England Gov. Mark Carney hinted at a possible rate cut by the British central bank, brokers said.

The market sank deeper in early afternoon trading but later resisted falling further.

The early afternoon dip can be traced to Shanghai stocks’ sluggish performance, brokers said. But the popularity of clothing store chain Fast Retailing, a heavyweight component of the Nikkei, underpinned the market, they added.

On the lethargic afternoon trading, Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc., said, “Investors found no reason to actively buy or sell.”

Expecting few surprises to come from trade relations between the United States and China for now after the top leaders of the two economies agreed to restart bilateral trade negotiations, market participants have shifted to “focus on the U.S. Federal Reserve’s Federal Open Market Committee meeting,” which will be held on July 30-31, Fujii also said.

Falling issues outnumbered rising ones 1,067 to 995 in the TSE’s first section, while 87 issues were unchanged.

Volume inched up to 1.01 billion shares from Tuesday’s 1.00 billion shares.

The stronger yen dampened export-oriented issues, including electronic parts supplier Murata Manufacturing, automaker Honda and chipmaking gear manufacturer Tokyo Electron.

Oil names met with selling prompted by falls in New York crude oil futures, with Idemitsu tumbling 2.92 percent and Cosmo Energy 2.71 percent.

Among other major losers were metal producer Mitsui Kinzoku and contractor Hazama Ando.

On the other hand, Fast Retailing jumped 2.67 percent, thanks to a rise in same-store sales in June.

Also on the positive side were power utility Kansai Electric and technology giant Sony.

In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average dropped 130 points to end at 21,590.

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