Japanese shares fall on profit booking, checking US rates

TOKYO: Japanese shares gave up early gains and slipped on Tuesday, as investors booked profits from recent rallies and treaded with caution as they await clues over the direction of US interest rates.

Nikkei share average lost 0.81% to 29,844.81 by 0208 GMT, after hitting the 30,000 mark for the first time in more than two weeks on Monday. The broader Topix fell 0.74% to 1,968.80

"Investors who bought stocks when the Nikkei hit the 30,000 mark earlier this year were disappointed when the index fell well below that level. Those who do not want to repeat that risk were selling the shares today," said Takatoshi Itoshima, strategist at Pictet Asset Management.

"The market fundamental is strong. But ultimately the stimulus packages in the US and the direction of the long term interest rates could determine the move of the Japanese market."

US Treasury yields edged lower overnight, as investors paused recent selling of government bonds, though the uptrend in rates remained intact following Friday's blockbuster jobs report.

Index heavyweights Fast Retailing, an operator of Uniqlo brand clothing stores, fell 1.44% and Tokyo Electron lost 1.62%.

Mizuho Financial Group dropped 2.43% after the bank said it would revise its IT contingency plans by the end of June, as it suffered four systems glitches during two weeks from February to March.

Mitsubishi UFJ Financial Group lost 2.28% and Sumitomo Mitsui Financial Group fell 1.85%.

Tracking a 4% decline in oil prices, oil and gas explorers Inpex lost 2.45% and Japan Petroleum Exploration slipped 1.77%.

The stocks that gained the most among the top 30 core Topix names were Hitachi, up 1.12 %, followed by Kao .

The underperformers among the Topix 30 were Takeda Pharmaceutical , down 2.51%, followed by Mizuho Financial Group.

There were 61 advancers on the Nikkei index against 160 decliners.