TOKYO: Japan’s Nikkei share average dropped on Friday, tracking overnight Wall Street losses following a hawkish tilt by US Federal Reserve Chair Jerome Powell, while heavyweight stocks SoftBank Group and Sony slumped after disappointing earnings.
The Nikkei dropped 1% to 32,319.51 as of 0200 GMT, with 160 of its 225 components declining, 63 rising and two trading flat.
The broader Topix slid 0.73% Overnight, the Fed chief said policymakers “are not confident” that policy is yet restrictive enough to tame inflation, helping to send 10-year US Treasury yields soaring as much as 13 basis points to 4.654%.
That led the dollar to surge as high as 151.39 yen , but without buoying the overall Japanese market.
“There really nothing of the ‘weaker yen means buy exporters on the boost to earnings,’” said Maki Sawada, a strategist at Nomura Securities.
“Instead it’s the rise in US yields that’s behind the weaker yen that is making investors nervous.” Growth shares took an outsized hit, with a Topix sub-index of the stocks retreating 0.87%, compared with a 0.57% decline for a sub-index of value shares.
Several big tech names also sold off after disappointing with earnings, with startup investor SoftBank Group’s 7.6% slump making it the Nikkei’s biggest drag.
Sony Group lost 2.72%.
Japan’s Nikkei rebounds on earnings boost, Nintendo extends rally
Nintendo slipped 2.88%, as investors took profits following a sharp two-day rally on robust earnings and game sales.
Financial results created a yawning gap between the biggest winners and losers in the session, with engineering company JGC and camera maker Nikon each tumbling in excess of 10%, while chemical company Resonac soared more than 10%.
Japanese earnings season reaches a crescendo on Friday, with about 650 reporting, including chip-making equipment giant Tokyo Electron, before mostly coming to an end on Tuesday of next week.
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