Nikkei reverses course to end lower
The Nikkei slipped 0.19% to 39,569.68 after rising as much as 0.8% earlier in the session. The index fell 0.6% this week.
The broader Topix rose 0.39% to 2,823.24.
Fast Retailing tanked 6.93% after the Uniqlo brand owner said on Thursday higher US tariffs would start impacting its US operations significantly from later this year and that it plans to raise prices to mitigate the blow.
'Investors were worried about Fast Retailing's outlook for the next fiscal year. Still, gains of technology stocks supported the index,' said Kentaro Hayashi, senior strategist at Daiwa Securities.
The market also sold stocks as soon as the Nikkei approached the psychologically important level of 40,000, strategists said.
Chip-related Advantest and Tokyo Electron rose 0.71% and 0.9%, respectively, to track a 0.75% gain in the Philadelphia SE Semiconductor Index overnight.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
10 hours ago
- Business Recorder
Asia shares, yen weather Japan uncertainty as earnings loom
SYDNEY: Asian shares and the yen held their ground on Monday as Japanese elections proved bad for the government but no worse than already priced in, while Wall Street futures braced for earnings from the first of the tech giants. Investors were also hoping for some progress in trade talks ahead of President Donald Trump's August 1 tariff deadline, with U.S. Commerce Secretary Howard Lutnick still confident a deal could be reached with the European Union. There were reports Trump and Chinese leader Xi Jinping were closer to arranging a meeting, though likely not until October at the earliest. In Japan, the ruling coalition lost control of the upper house in an election on Sunday, further weakening Prime Minister Shigeru Ishiba's grip on power as a tariff deadline looms. Ishiba expressed his intention to stay in the position, which along with a market holiday, limited the reaction and the yen was 0.4% firmer at 148.29 to the dollar. 'Ishiba will try to govern with support from some within the opposition, but this likely means a looser fiscal policy and is not good news for bond yields,' said Rodrigo Catril, a senior FX strategist at NAB. 'History also suggests that domestic political uncertainty tends to keep the BOJ on the side-lines, so the prospect of rate hikes is now set to be delayed for a little bit longer.' The Bank of Japan still has a bias to raise rates further but markets are pricing little chance of a move until the end of October. While the Nikkei was shut, futures traded up at 39,875 and just above the cash close of 39,819. MSCI's broadest index of Asia-Pacific shares outside Japan was flat, while South Korean stocks added 0.4%. Mega caps kick off S&P 500 futures and Nasdaq futures both edged up 0.1%, and are already at record highs in anticipation of more solid earnings reports. A host of companies reporting this week include Alphabet and Tesla, along with IBM (IBM.N), opens new tab. Investors also expect upbeat news for defence groups RTX, Lockheed Martin and General Dynamics. Ramped up government spending across the globe has seen the S&P 500 aerospace and defence sector rise 30% this year. In bond markets, U.S. Treasury futures held steady having dipped late last week after Federal Reserve Governor Christopher Waller repeated his call for a rate cut this month. Most of his colleagues, including Chair Jerome Powell, have argued a pause is warranted to judge the true inflationary impact of tariffs and markets imply almost no chance of a move in July. A September cut is put at 61%, rising to 80% for October. Powell's reticence on rates has drawn the ire of Trump who threatened to fire the Fed chief, before backing down. The spectre of a potential political appointee who would seek to ease policy sharply has investors on edge. The European Central Bank meets this week and is expected to hold its rates steady at 2.0% following a string of cuts. 'The press conference will likely keep highlighting uncertainty and need to wait for tariff negotiations to conclude before deciding the next step,' said analysts at TD Securities in a note. 'Similarly, its 'meeting-by-meeting' language would be retained in the release.' The euro was unchanged at $1.1630 in early trading, having dipped 0.5% last week and away from its recent near-four-year top of $1.1830. The dollar index was a fraction lower at 98.40 . In commodity markets, gold was little changed at $3,348 an ounce with all the recent action in platinum which last week hit its highest since August 2014. Oil prices were caught between the prospect of increased supply from OPEC+ and the risk European Union sanctions against Russia for its war in Ukraine could curb its exports. Brent edged up 0.1% to $69.36 a barrel, while U.S. crude added 0.1% to $67.39 per barrel.
Business Recorder
3 days ago
- Business Recorder
Asian shares track Wall Street higher, yen weak ahead of Japan vote
SYDNEY: Asian shares tracked Wall Street higher on Friday as still-strong US economic data and robust corporate earnings offset tariff worries, while the yen headed toward a second successive week of loss ahead of Japan's upper house election. Overnight, the S&P 500 and the Nasdaq again closed at record highs as U.S. data including retail sales and jobless claims beat forecasts, indicating a modest improvement in the economy that should give the Federal Reserve time to gauge the inflation impact from higher U.S. tariffs. Streaming giant Netflix beat Wall Street's lofty expectations for second-quarter earnings in part due to a weaker U.S. dollar. Its share price, however, fell 1.8% in after-hours trading, with analysts saying much of the growth had already been priced in. On Friday, MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.8% to its highest since late 2021, bringing the weekly gain to 1.7%. Japan's Nikkei, however, slipped 0.2%, and the yenwas at 148.54 per dollar, down about 0.7% this week after polls showed Prime Minister Shigeru Ishiba's coalition was in danger of losing its majority in the election on Sunday. Data on Friday showed Japan's core inflation slowed in June due to temporary cuts in utility bills but stayed beyond the central bank's 2% target. The rising cost of living, including the soaring price of rice, is among reasons for Ishiba's declining popularity. 'If PM Ishiba decides to resign on an election loss, USDJPY could easily break above 149.7 as it would usher in an initial period of political turbulence,' said Jayati Bharadwaj, head of FX strategy at TD Securities. 'JPY could reverse the recent dramatic weakness if the ruling coalition wins and is able to make swift progress on a trade deal with Trump.' Chinese blue-chips rose 0.3% while Hong Kong's Hang Seng index gained 1.2%. The Tapei-listed shares of TSMC, the world's main producer of advanced AI chips, rallied 2.2% after posting record quarterly profit on Thursday, though it said future income might be affected by U.S. tariffs. In the foreign exchange market, U.S. the dollar was on the back foot again on Friday, having bounced 0.3% overnight against major peers on the strong economic data. For the week, it is headed for a second successive gain of 0.6%, bouncing further from a 3-1/2 year low hit over two weeks ago. Fed Governor Christopher Waller said on Thursday he continues to believe the central bank should cut interest rates at the end of this month, though most officials who have spoken publicly have signalled no desire to move. Fed funds futures imply next to no chance of a move on July 30, while a September rate cut is just about 62% priced in. Treasury yields were slightly lower in Asia. Benchmark 10-year U.S. Treasury yields slipped 2 basis points to 4.445%, having moved little overnight. Two-year yields also edged 2 bps lower to 3.8981. Oil prices were mostly steady on Friday, after gaining $1 overnight following a fourth day of drones strikes on Iraqi Kurdistan oil fields, pointing to continued risk in the region. U.S. crude inched up 0.2% to $67.66 per barrel and Brent also rose 0.2% to $69.68 a barrel. They, however, lost about 1% for the week. Spot gold prices were steady at $3,337 an ounce but were set for a 0.5% weekly loss.
Business Recorder
3 days ago
- Business Recorder
Japan's Nikkei edges down, off near 2-week high amid election outcome worries
TOKYO: Japan's Nikkei share average slipped from a more than two-week high to trade lower on Friday as investors weighed the outcome of the nation's upper house election due on the weekend. The Nikkei slipped 0.31% to 39,778.85 by the midday break. Earlier, it had risen to as much as 40,087.59, its highest level since July 1, underpinned by the strong performance of Wall Street, but fell soon as investors started selling to book profits. The S&P 500 stock index and the Nasdaq Composite both finished at record highs on Thursday, as investors embraced strong economic data and earnings reports that showed American consumers remained willing to spend. For the week, the Nikkei is set to rise 0.5% and snap a two straight weeks of losses. The broader Topix was down 0.13% to 2,836.1. 'Investors did not want to take a risk in buying stocks ahead of the national election on the weekend,' said Yugo Tsuboi, chief strategist at Daiwa Securities. 'But the momentum is not bad as about half the stocks rose.' Prime Minister Shigeru Ishiba's Liberal Democratic Party (LDP) and its partner Komeito are expected to lose their majority in the upper house on Sunday. Strategists now focus on whether Ishiba will remain in his position or step down after the election, as a gauge of the nation's potential policy shift, which could lead to a cut in the national consumption tax. Chip-related heavyweight fell, with Advantest and Tokyo Electron losing 4.27% and 0.7%, respectively. Disco tanked 10.26% to become the biggest percentage loser on the Nikkei, as the chipmaking device supplier's quarterly operating profit forecast missed market expectations. Uniqlo-brand owner Fast Retailing rose 0.79% to provide the biggest support to the Nikkei. Technology investor SoftBank Group rose 1.5%. Of more than 1,600 stocks on the Tokyo Stock Exchange's prime section, 42% rose and 53% fell, and 4% traded flat.
