Tokyo stocks snapped their five-session winning streak Thursday, as investors moved to lock in gains amid a dearth of major reasons to buy.
The 225-issue Nikkei average of the Tokyo Stock Exchange sank 93.18 points, or 0.33%, to finish at 28,549.01, after climbing 88.21 points Wednesday.
The Topix index of all TSE first section issues slipped 9.65 points, or 0.50%, to end at 1,911.02, following a 1.15-point rise the previous day.
Selling outpaced buying from the outset, with players growing wary of high prices in the wake of the five-session rally through Wednesday, which lifted the Nikkei by nearly 600 points.
The market was also weighed down by fears over capital outflow ahead of the removal of 29 Japanese component issues in the rebalancing of MSCI global stock indexes later in the day, brokers said.
Stocks recouped losses to some extent in the afternoon following a rise in U.S. Dow Jones Industrial Average futures in off-hours trading. But both the Nikkei and Topix indexes stayed in negative terrain due to a lack of powerful buying incentives.
The Tokyo market turned down although Wall Street rebounded the previous day.
“This reflected a stark contrast in the coronavirus situations in Japan and the United States,” Kazuo Kamitani, strategist at Nomura Securities Co., said. “Japan is in the midst of a fourth wave of infections while the United States is coming out of the virus crisis.”
Many investors are expected to sit on the fence until closely watched U.S. economic indicators, including nonfarm payrolls, are released next week, Kamitani added.
“The market was underpinned by buying of companies that had been sold despite their good earnings performance due to too-high market expectations,” said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co.
In the TSE first section, decliners outnumbered gainers 1,647 to 474 while 71 issues were unchanged. Volume swelled to 2.404 billion shares from Wednesday’s 1.096 billion shares.
Shipping firm Kawasaki Kisen and steel-maker JFE sank along with other cyclicals.
Fujitsu tumbled 3%, after data of its corporate clients were stolen due to unauthorized access to the firm’s information-sharing tool.
Other noticeable losers included game-maker Nintendo and TSE operator JPX.
On the other hand, drugmaker Astellas jumped 3.38% following its announcement of a new five-year business strategy.
Airlines ANA and JAL continued to attract buying on hopes for recovery in air travel demand as coronavirus vaccinations progress in Japan.
In index futures trading on the Osaka Exchange, the key June contract on the Nikkei average fell 60 points to end at 28,530.
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