Tokyo stocks open lower despite US gains

TOKYO: Tokyo stocks opened lower Monday with investors seeking new cues after a solid US jobs report lifted Wall Street shares to record highs last week.

The Nikkei 225 index dropped 0.48 percent, or 137.06 points, to 28,646.22 in early trade.

The broader Topix index slipped 0.42 percent, or 8.28 points, to 1,948.03.

The subdued start to the day came as analysts said they expected the market to stay range-bound throughout the week.

"Investors are looking for fresh incentives, with the US market taking a break tonight, while the continued spread of Covid-19 weighs on the market," Okasan Online Securities said.

Monday is a market holiday on Wall Street for Independence Day.

Local elections were held in Tokyo on Sunday, with the ruling Liberal Democratic Party (LDP) bloc projected to have fallen short of a majority.

The vote was seen as a key test for the LDP ahead of a national election due later this year likely to decide the fate of Prime Minister Yoshihide Suga.

After the Tokyo poll, "it is difficult to chase the upper side" of the market, Okasan said.

The brokerage said it expected Tokyo shares to stay relatively well supported this week, as the US market is showing strength.

But it also noted that the Nikkei average fell short of following the healthy gains of foreign indexes last week.

"The Tokyo market lacks the momentum to actively test its upper limit," Okasan said. "We expect the market to continue to search for a sense of direction."

The dollar stood at 111.15 yen, compared with 111.04 yen on Friday in New York.

Among major shares, Toyota fell 0.40 percent to 9,781 yen. Sony Group dropped 0.75 percent to 11,255 yen.

Uniqlo-operator Fast Retailing gave up 1.69 percent to 81,680 yen. SoftBank Group plunged 5.11 percent to 7,413 yen.