TOKYO: Japan’s Nikkei share average ended at a two-week low on Thursday, led by a sell-off of exporters on the back of yen’s overnight strength, while heavyweight technology stocks tracked the Nasdaq’s weakness.
The Nikkei index fell 1.22% to close at 27,472.63, its lowest since March 24.
The broader Topix lost 1.14% to 1,961.28.
The S&P 500 dipped and the Nasdaq ended sharply lower overnight after a growing wave of weak economic data deepened worries that the Federal Reserve’s rapid interest rate hikes might tip the US economy into a recession.
Overnight, the dollar held near two-month lows after the weak data supported the view that the Federal Reserve may not need to raise rates much further, propping the yen up.
A stronger yen is a blow for exporter shares as it squeezes the value of overseas profits in yen terms when firms repatriate them to Japan.
“The yen gained overnight, which prompted investors to sell exporters, and the chip-related shares tracked the Nasdaq weakness,” said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management.
“Japanese shares will be under pressure from a sign of slowdown of the US economy for a while. But towards the end of the month, there may be some domestic market moving cues as companies start reporting outlook, and the Bank of Japan will have a policy meeting.”
Tokyo stocks close higher after US gains
Chip-making equipment maker Tokyo Electron slipped 4.53% Air-conditioning maker Daikin Industries Ltd lost 4.30%, leading the losses in the machinery makers’ 3.11% loss, which was the worst among the Tokyo Stock Exchange’s 33 industry sub-indexes.
Automaker Mazda Motor fell 4.96% to become the worst performer on the Nikkei.
Game and audio-equipment maker Sony Group lost 2.16% and a robot maker Keyence Corp slipped 4.13%.
The utility sector gained 1.04% to become the best performer among the sector indexes, with Tokyo Electric Power Holdings rising 2.27% to become the best performer on the Nikkei.
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