TOKYO: Japanese shares on Thursday closed at their lowest in more than two months, as investors reacted to the US Federal Reserve’s hawkish projections and the Bank of Japan’s decision to maintain its ultra-easy monetary policy.
The Nikkei 225 index opened down 0.95% and fell through the 27,000-mark for the first time since July 19.
It later recovered slightly and ended down 0.58% at 27,153.83. The broader Topix fell 0.25%.
The Nikkei’s slide tracked broad losses on Wall Street after the Fed delivered a widely expected 75-basis-point rate increase and signalled no letup in its approach to tackling inflation, forecasting more substantial hikes on its “dot plot” chart.
“The rate hike was as expected, but the upward revision of the dot plot was considered hawkish and made some think about the prospect of a long period of monetary tightening,” said Tomoichiro Kubota of Matsui Securities.
S&P 500 e-mini futures were last down 0.4%. BOJ Governor Haruhiko Kuroda is set to address a press conference after markets close in Japan, with investors primed for further clues to the bank’s future policy outlook.
“We watch for any comments by Governor Kuroda that suggest a strong accommodative bias as they could trigger further weakness of the yen,” wrote Naohiko Baba, chief Japan economist at Goldman Sachs, in a note.
Japan’s Nikkei ends at 2-month low with Fed, BOJ meetings in focus
The yen briefly reached a new 24-year low of 145.405 to the dollar after the BOJ’s announcement and last traded at 144.97.
Of the Nikkei index’s 225 constituents, 150 declined, 63 advanced, and 12 traded flat. Fast Retailing Co Ltd, SoftBank Group Corp, and Recruit Holdings Co Ltd were the biggest drags on the index.
Toyota Motor Corp gained 1.4% to notch the largest positive impact.
Markets will be closed in Japan tomorrow for a national holiday.
Comments
Comments are closed.