TOKYO, April 15 (Xinhua) -- Tokyo stocks closed lower on Friday as large-capped technology issues followed their dropping U.S. peers overnight, although losses were trimmed as investors bought back issues ahead of the long Easter weekend in some markets overseas.

The 225-issue Nikkei Stock Average lost 78.81 points, or 0.29 percent, from Thursday to close the day at 27,093.19.

The broader Topix index, meanwhile, dropped 11.74 points, or 0.62 percent, to finish at 1,896.31.

Local dealers said technology shares took a dip, dragged down by a lackluster performance by their peers overnight on Wall Street, with investors having to contend with concerns over rising bond yields and a slew of mixed corporate earnings.

"U.S. Treasury yields have recently surged rapidly but it may slow down. It is possible for the dollar to become top heavy ahead of the Fed's monetary policy meeting in early May, Yukio Ishizuki, a senior foreign exchange strategist at Daiwa Securities Co., was quoted as saying.

The Japanese yen dropped to a 20-year low in the mid-126 range versus the U.S. dollar on Friday, owing to concerns over a widening monetary policy gap between the Bank of Japan (BOJ) and the U.S. Federal Reserve.

The Japanese currency slipped below Wednesday's previous low of 126.3, to mark its lowest level since May 2002, as an overnight rise in U.S. Treasury yields led to market players offloading the Japanese currency.

This is as a result of the prospect of a widening monetary policy gap as the Fed has started to tighten its policy to combat inflation and has suggested there could be multiple rate hikes this year, whereas the BOJ has maintained its ultra-loose monetary easing policy position underpinned by the bank's long-held dovish stance.

Typically, Japanese mainstay exporter firms cheer a weaker yen as it enhances price competitiveness in overseas markets and can see profits augmented when repatriated on favorable exchange rates.

However, a recent surge in energy and commodity prices that resource-poor Japan has to import is hurting companies' balance sheets due to the yen's weakness, which is weighing on consumer spending, market analysts said.

Market analysts said, however, the yen's weak tone in fact gave some exporters a lift and the overall market decline was limited as investors bought back issues deemed oversold.

"But the decline on the market was limited today because investors bought back stocks as they bet there would be no major moves on the markets overnight due to the long weekend in the U.S. and elsewhere," Ishizuki said.

By the close of play, precision instrument, electric appliance and air transportation issues comprised those that declined the most among Prime Market issues, with issues that fell outpacing those that rose by 1,350 to 434, while 55 ended the day unchanged.

Among tech issues losing ground, Tokyo Electron dropped 5 percent, while Advantest closed over 4 percent lower.

Nikkei heavyweight SoftBank Group, an investor in technology startups, dropped 1.2 percent, while Sony Group relinquished 2.5 percent by the close.

Uniqlo clothing shop owner Fast Retailing, another heavily-weighted Nikkei component, helped trim losses, however, soaring 8.8 percent, after announcing solid first-half profits after the closing bell the previous day.

On the Prime Market on Friday, 880.06 million shares changed hands, dropping from Thursday's volume of 1,010.05 million shares.

The turnover on the final trading day of the week came to 2,044.80 billion yen (16.16 billion U.S. dollars). Enditem

Related

Go to Forum >>0 Comment(s)