The benchmark Nikkei average continued to go south on Friday, with investor sentiment battered by a further rise in U.S. long-term interest rates.
The 225-issue Nikkei average surrendered 65.79 points, or 0.23%, to finish at 28,864.32. On Thursday, the key index plunged 628.99 points.
Meanwhile, the Topix index of all first section issues closed 11.44 points, or 0.61%, higher at 1,896.18, in a turnaround from a 19.80-point drop the previous day.
Selling gathered steam from the outset of Friday’s trading, causing the Nikkei to shed over 600 points briefly in the morning, in the wake of plunges in all three major U.S. stock market gauges, including the Nasdaq composite index, on Thursday against the backdrop of a rise in the key U.S. 10-year interest rate.
The Tokyo market later managed to cut losses in the afternoon, thanks to buying on dips and buybacks.
While the Topix emerged to the sunny side, the Nikkei continued to move in negative territory, as semiconductor-related and other technology issues that are heavily weighted Nikkei components buckled under selling pressure, following falls in the tech-heavy Nasdaq and SOX Philadelphia semiconductor indexes.
Market participants were disappointed to learn that U.S. Federal Reserve Chairman Jerome Powell at an online event Thursday failed to offer steps to curb rising interest rates, which were responsible for dives in both U.S. and Japanese stock prices from late last week, a strategist at a securities firm said.
“Market participants were also worried that long-term interest rates will continue to climb if the U.S. government’s employment data for February, due out later on Friday, show stronger-than-expected readings,” said Yutaka Miura, senior technical analyst at Mizuho Securities Co.
Meanwhile, brokers said that the underside of the Tokyo market in late trading was supported by the resilience of Dow Jones Industrial Average futures in off-hours trading and Chinese stocks.
In the TSE first section, rising issues overwhelmed falling ones 1,352 to 753 while 89 issues closed unchanged. Volume increased to 1.430 billion shares from Thursday’s 1.285 billion shares.
Among major technology issues that suffered plunges, chipmaking gear maker Tokyo Electron fell 2.47% and chip testing device manufacturer Advantest skidded 1.27%.
Job information service provider Recruit Holdings and clothing store chain Fast Retailing also succumbed to hefty selling pressure.
On the other hand, Inpex surged 4.24% after SMBC Nikko Securities Inc. raised its target price for the oil resources developer.
Sekisui House gained 4.32% after the company announced a plan to buy back own shares.
In index futures trading on the Osaka Exchange, the key March contract on the Nikkei average shed 220 points to end at 28,760.
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