Tokyo, November 28, 2023, The Europe Today: Tokyo stocks dropped Tuesday for a second straight day, as the yen’s strength spurred selling of some exporters while the market showed caution ahead of U.S. economic data that will be released later this week.
The 225-issue Nikkei Stock Average ended down 39.28 points, or 0.12 percent, from Monday at 33,408.39. The broader Topix index finished 5.05 points, or 0.21 percent, lower at 2,376.71.
On the top-tier Prime Market, decliners were led by securities house, insurance and marine transportation issues.
The U.S. dollar briefly weakened to below the 148 yen line in Tokyo, tracking a decline of U.S. long-term interest rates amid anticipation that the Federal Reserve is likely done raising rates, dealers said.
Stocks were initially supported by bargain-hunting following a decline the previous day, but they mostly stayed in negative territory as sentiment was dampened by falls in U.S. markets, while the yen’s continued strength weighed on some export-heavy issues.
Losses were trimmed in the afternoon, with the Nikkei briefly going positive, as investors sought stocks battered in recent selling, but buying was limited as the market waited for U.S. economic data and statements from Fed officials, analysts said.
“The rest of the week is eventful with major economic indicators abroad, leading participants on the Japanese market to take a wait-and-see approach today,” said Masahiro Yamaguchi, head of investment research at SMBC Trust Bank.
Among such events are the U.S. personal consumption expenditure price index that is expected to offer further clues on inflation and remarks from Fed Chair Jerome Powell, with investors now focusing on when the central bank could start cutting interest rates.
Exporters such as Mazda Motor were down 38.5 yen, or 2.3 percent, to 1,621.5 yen, while Panasonic Holdings declined 10.0 yen, or 0.6 percent, to 1,543.0 yen, as a firming yen raised the prospect of their overseas profits being reduced when repatriated.
Major marine transportation companies also fell after heavy buying on Monday. Nippon Yusen dropped 29 yen, or 0.7 percent, to 3,980 yen, while Kawasaki Kisen slipped 58 yen, or 1.1 percent, to 5,195 yen.
Meanwhile, trading house Sojitz jumped 263 yen, or 8.5 percent, to 3,370 yen after setting a return on equity target of 12 percent or more and placing emphasis on shareholder returns in its medium-term management plan through 2026.
