TOKYO: Japan’s Nikkei share average traded lower on Thursday, tracking an overnight drop in the US markets, while traders awaited the conclusion of the Bank of Japan’s policy meeting due later in the day.
The Nikkei was down 0.4% at 39,134.95, as of 0219 GMT, while the broader Topix slipped 0.41% to 2,692.88.
“The Nikkei tracked the overnight declines of US equities, but the Nikkei has also retreated from gains in the previous session, which was too strong,” said Shigetoshi Kamada, general manager at the research department at Tachibana Securities.
Japan’s Nikkei share average rose to a two-week closing high on Wednesday.
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The Nikkei peaked in July, and has since been hostage to a volatile yen, driven by US Federal Reserve rate expectations and the dollar. The currency is still up more than 17% this year.
Japan’s markets have been hamstrung this week by political uncertainty after the ruling Liberal Democratic Party-led coalition lost its parliamentary majority in the weekend election.
The make-up of Japan’s future government is in flux and may see Prime Minister Shigeru Ishiba and the LDP court smaller opposition parties, that favour maintaining ultra-loose monetary policy and oppose plans to raise taxes.
Thursday and signal a cautious approach to rolling back its massive monetary stimulus, as political uncertainty and jittery markets cloud the outlook.
Uniqlo-brand owner Fast Retailing fell 1.5 % to drag the Nikkei the most.
Shares of Kyocera tanked 11.1% after the ceramics maker cut its annual operating profit forecast.
Advantest jumped 7% as the chip-testing equipment maker raised its annual operating profit forecast.
Source: Brecorder
