TOKYO: Tokyo stocks fell in morning trade on Wednesday following a slump on Wall Street as investors await a key decision from the US Federal Reserve.
The benchmark Nikkei 225 opened flat then dropped 0.87 percent, or 235.67 points, to 26,895 in morning trade, while the broader Topix index lost 0.41 percent, or 7.87 points, to 1,888.75.
Investors are reluctant to partake in active buying ahead of the US central bank's policy-setting meeting, Okasan Online Securities said.
Tokyo stocks close lower on Ukraine concerns
After spending much of last year playing down the spike in prices, the Fed has in recent months taken a sharp hawkish turn on monetary policy as officials look to bring inflation -- which is at a four-decade high -- under control.
While markets are increasingly jittery over anticipation of its tightening of monetary policy, shares could rebound if the Fed's decision turns out "less hawkish than expected," Okasan said. "At any rate, all eyes are on how US shares will respond," the brokerage added.
Other factors such as geopolitical tensions over the Ukraine-Russia situation and a global chip shortage have contributed to the "elevated" volatility of global markets, Edward Moya, senior market analyst at OANDA said in a note.
"Optimism remains that a massive correction is still unlikely to happen because the US growth story will likely remain intact this year, but Wall Street is not seeing many buyers emerge ahead of the Fed and as the conflict in Ukraine escalates," Moya said.
The dollar fetched 113.81 yen in early Asian trade, against 113.87 yen in New York late Tuesday.
Among major shares, market heavyweight Softbank Group added 0.59 percent to 5,099 yen while Toyota fell 0.31 percent to 2,229.5 yen.
Toyota is eyeing a record production target of 11 million cars for fiscal year 2022, the Nikkei business daily reported, despite uncertainty over the chip shortage and Covid surges.
Meanwhile, US group Nvidia is poised to give up on what would have been the biggest semiconductor deal in history -- purchasing UK chip designer Arm from SoftBank Group -- after failing to make progress on approval, Bloomberg reported.
Sony inched up 0.24 percent to 12,510 yen. Uniqlo operator Fast Retailing was down 0.50 percent to 67,660 yen.
Comments
Comments are closed.