Shares in Tokyo ended lower on Friday as the latest strong economic data in the United States fueled the view that the Federal Reserve will continue to aggressively raise interest rates to calm inflation, dealing a blow to the largest economy in the world.
The 225-number Nikkei Stock Average ended down 308.26 points, or 1.11%, from Thursday at 27,567.65. The broader Topix index ended 11.87 points, or 0.61%, down at 1,938.56.
In the leading high-end market, declines were led by issues in shipping, mining and electrical appliances.
The U.S. dollar was mostly trading in the 143 yen mid-range, as buying on the Fed’s continued rate hike outlook was offset by caution over a possible yen-buying intervention by Japanese monetary authorities, said the dealers.
The currency market has also taken a wait-and-see attitude ahead of Fed and Bank of Japan policy meetings next week, dealers said.
At 5 p.m., the dollar was worth 143.44-47 yen against 143.44-54 yen in New York and 143.56-58 yen in Tokyo on Thursday at 5 p.m.
The euro traded at $0.9955-9957 and 142.81-85 yen against $0.9989-9999 and 143.37-47 yen in New York and $0.9977-9978 and 143.23-27 yen in Tokyo late Thursday afternoon.
The yield on the Japanese 10-year government bond was unchanged from Thursday’s close at 0.25%, ending at the Bank of Japan ceiling.
Stocks were sold throughout the day as stronger-than-expected retail sales data for August and lower-than-expected U.S. jobless claims, both released on Thursday, bolstered the view that the Fed is unlikely to loosen its monetary grip, analysts said.
“Economic data followed by higher long-term US Treasury yields (against expectations of Fed rate hikes) weighed on semiconductor issues in the US and Japan,” he said. said Masahiro Yamaguchi, head of investment research at SMBC Trust. Bank.
Investors have expressed concern that higher interest rates will increase borrowing costs for households and businesses, hurt the US economy and impact the global economy.
Shipping issues were hit in Tokyo after FedEx Corp.’s first-quarter results. Thursday fell short of market expectations, with the US shipping giant citing “macroeconomic weakness in Asia and service issues in Europe.”
The company also withdrew its fiscal 2023 profit forecast provided in June and said it would close more than 90 offices.
“FedEx earnings have fueled concerns about the U.S. economic outlook…it’s just a matter of when the downturn will occur,” Yamaguchi added.
Among shipping issues, Nippon Yusen lost 250 yen, or 2.5%, to 9,790 yen, and Kawasaki Kisen lost 410 yen, or 5.1%, to 7,630 yen.
The Tokyo stock market was also weighed down by selling position adjustments ahead of a three-day weekend as Japanese financial markets will be closed for a public holiday on Monday, brokers said.
Among the market’s prime issues, declining issues outnumbered advances by 1,233 to 551, while 53 ended the day unchanged.
Semiconductor equipment maker Tokyo Electron plunged 1,850 yen, or 4.3%, to 40,910 yen, and chipmaker Screen Holdings lost 360 yen, or 3.9%, to 8,850. yen.
Trading volume on the main market rose to 1,417.56 million shares from 897.54 million on Thursday.