Stocks turned lower on the Tokyo Stock Exchange Monday, following a drop in U.S. equities on Friday.
The 225-issue Nikkei average sagged 50.20 points, or 0.23 percent, to end at 21,416.79. On Friday, the key market gauge jumped 420.75 points.
The TOPIX index of all first-section issues was down 7.59 points, or 0.49 percent, at 1,556.37, after surging 29.69 points the previous trading day.
A fall in the Dow Jones industrial average on Friday on receding expectations for a big interest rate cut by the U.S. Federal Reserve as well as lower Shanghai stocks on Monday pushed down Japanese stocks, brokers said.
But the Nikkei’s loss was limited thanks to a stable yen against the dollar, they said.
The result of Sunday’s House of Councillors election, in which the ruling bloc won a majority of the contested seats, was unsurprising and had only a limited impact on the Tokyo market, brokers said.
A cautious mood prevailed ahead of a series of major events, an official at a Japanese securities house said, referring to earnings releases from major Japanese firms set to start later this week and the Fed’s monetary policy meeting next week.
Volume decreased to 905 million shares from 1,109 million shares on Friday.
“Investors found it inadvisable to trade actively,” said Hiroaki Hiwada, strategist at Toyo Securities Co. Monday’s drop in the key indexes came in response to Friday’s surge, he said.
Falling issues outnumbered rising ones 1,318 to 730 in the TSE’s first section, while 102 issues were unchanged.
Asahi plunged 8.87 percent as its agreement to acquire Australian beer maker Carlton & United Breweries raised concerns over the Japanese beverage firm’s finances, brokers said.
Realtors met with selling, with Mitsubishi Estate falling 1.76 percent, Nomura Estate dropping 1.59 percent and Sumitomo Realty sliding 1.36 percent.
Among other losers were air conditioner maker Daikin and drug maker Daiichi Sankyo.
Semiconductor-related names rose as reported telephone talks between senior U.S. and Chinese officials raised hopes for progress in ending their trade dispute, brokers said. Major gainers in the sector included Tokyo Electron, Screen and Advantest.
Also on the positive side were technology investor Softbank Group and industrial robot producer Fanuc.
In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average was down 20 points at 21,360.