Tokyo shares edge down ahead of Bernanke speech

TOKYO: Tokyo shares edged down Friday morning, following a slump on Wall Street as investors awaited a much-anticipated speech from US Federal Reserve chief Ben Bernanke.

The Nikkei 225 index fell 5.82 points or 0.07 percent to 8,766.54 by noon, but the Topix index rose 0.75 points, or 0.10 percent, to 752.57.

Investors have been waiting to see if the Fed will react by further loosening monetary policy, following slumps in world markets in recent weeks on concerns over a slowing US economy and the fallout from Europe's debt crisis.

The Nikkei tracked falls on Wall Street overnight, where the Dow Jones Industrial Average dropped 1.51 percent and the broader S&P 500 dropped 1.56 percent.

Stocks have slumped in recent weeks amid fears of a slowing US economy and fallout from Europe's debt crisis, and investors have been waiting to see if the Fed will react by further loosening monetary policy.

But analysts were sceptical that Bernanke would endorse a further round of quantitative easing, or "QE", in which the Fed buys assets from banks with electronically-generated cash to inject money into the economy.

"This may be the calm before the storm," Hisatsune Kobayashi, general manager of global investment strategy at SMBC Nikko Securities, told Dow Jones Newswires, referring to sluggish trading in Tokyo on Friday.

"Although most market players don't expect US Fed Chairman Ben Bernanke to introduce aggressive monetary easing measures tonight, investors will nevertheless be disappointed if he does nothing at all."

The yen continued to weaken against the dollar, with the greenback fetching 77.30 yen from 76.97 a day earlier as the US unit rose ahead of Bernanke's speech.

The euro was at 111.35 yen from 110.86 yen.

Exporters were mixed. Sony rose 0.37 percent to end the morning session at 1,587 yen, but Toyota lost 0.14 percent to 2,760 yen.

Automakers that saw big gains Thursday were lower on profit taking and US economic uncertainty, said dealers. Nissan was off 0.59 percent at 669. Honda was down 0.98 percent at 2,419.

Apple-related shares were mixed after the US firm closed 0.7 percent lower on Wall Street on news chief executive Steve Jobs resigned for health reasons.

Softbank, the sole distributor in Japan of Apple's iPhone, was flat at 2,507.

Among Japanese companies that supply parts to Apple, Sharp added 0.50 percent to 602 yen but Ibiden slipped 1.39 percent to 1,764 yen.

The market was largely unaffected by Japan's announcement of a 0.1 percent rise in its core consumer prices in July from a year earlier compared with market expectations of a 0.1 percent fall.

Copyright AFP (Agence France-Presse), 2011