Japan's Nikkei slides for second day as strong yen weighs
Japan's Nikkei share average dropped for a second day on Thursday, extending its retreat from a nearly three-month peak, as a stronger yen sent automaker shares sliding.
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Japan's Nikkei share average dropped for a second day on Thursday, extending its retreat from a nearly three-month peak, as a stronger yen sent automaker shares sliding.The Nikkei sank 1% to 37,755.51 as of the close, as the yen strengthened for a third day, eroding the value of Japanese exporters' overseas revenues.The broader Topix fell 0.9%, also a second session of losses.The Nikkei had rallied 25% between a low on April 7 and the high on Tuesday, partly as optimism built for a spate of U.S. trade deals that would remove the risk of a global recession."The run-up in the Nikkei had been very fast, and we're still at a very high level," said Maki Sawada, a strategist at Nomura."Investors are cautious that there is still a degree of overheating in the market."Transport equipment was the worst performer among the Tokyo Stock Exchange's industry groupings, dropping 2.8%.Toyota tumbled 3.4%, while Honda and Nissan each slumped 3.9%.Overnight news that U.S. and South Korean officials met last week to discuss the exchange rate ignited speculation that Washington may seek a weaker exchange rate for the dollar as part of trade negotiations with Asian nations.The Korean won surged as a result, pulling the yen along in its wake.Electronics exporters were also weak, with Sony losing 2.8% and Nintendo slipping 2.2%.Uniqlo owner Fast Retailing fell 1.5% to be the biggest points drag on the Nikkei due to its heavy weighting.Of the Nikkei's 225 components, 147 fell and 76 rose, with two flat.Shipping was a bright spot, jumping 2.4% to be far and away the best performing TSE industry group, as a thaw in Sino-U.S. trade relations boosted the outlook for cargo traffic.
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