Japan’s Nikkei falls but losses capped by Wall Street rebound hopes

TOKYO: Japan’s Nikkei share average fell for a second day on Tuesday, but avoided bigger losses as investors began to buy back stocks in hopes of a rebound on Wall Street later in the day.

The Nikkei ended the day down 0.58% at 26,167.10, cutting losses in the afternoon session as US stock futures rallied.

The benchmark dropped to as low as 25,773.83 for the first time since mid-March in the morning, taking cues from a sharp sell-off on Wall Street overnight, particularly among tech names.

The broader Topix slid 0.85% to 1,862.38.

Futures for the tech-focused Nasdaq were 1.4% higher, after the index slumped more than 4% overnight.

“After the steep drop in the Nasdaq and other indexes, from a technical perspective, investors are starting to expect a rebound,” said Kazuo Kamitani, a strategist at Nomura Securities.

Tech names were still the biggest drags on the Nikkei though, with NTT Data, chip giant Tokyo Electron and peer Advantest, startup investor SoftBank Group, and Sony Group shaving a combined 100 index points off the benchmark.

NTT Data fell for a second day after an announcement on Monday that it would combine overseas businesses with parent NTT disappointed investors who had speculated the subsidiary would be taken private.

Japan Steel Works was the Nikkei’s biggest percentage decliner for a second day, plunging 15.57%, after revealing at the start of the week that a subsidiary had falsified product data going back to at least 1998.

Similar to Monday, utilities were the only Nikkei sub-sector to advance.

Of the benchmark index’s 225 component stocks, 139 fell versus 83 that rose and three that were flat.