TOKYO: Japan’s Nikkei share average fell on Friday as weakness on Wall Street and some poor domestic earnings results took a toll on sentiment, although the benchmark index managed to protect its first weekly gain in three.
Selling was also capped by some bright spots in domestic earnings, as well as caution over taking positions heading into next week when the US Federal Reserve decides policy.
The Bank of Japan’s decision earlier in the day to keep stimulus settings unchanged, as was expected, had limited effect on the market.
The Nikkei lost 0.88% to 27,105.30, but stayed well above the psychological 27,000-mark. It had briefly dipped below that level in the morning, for the first time since Monday.
The broader Topix slipped 0.34% to 1,899.05, giving up a small rise from the recess.
For the week, though, the Nikkei is 0.8% stronger, while the Topix is 0.91% higher, with both notching the first weekly gains since the week ended Oct. 7.
Overnight, US tech earnings continued a disappointing run, knocking the Nasdaq to a 1.6% loss.
“There’s a possibility the Fed could show a more dovish posture going forward, but earnings from America’s tech giants were just too bad and looks likely to keep Japanese stocks under pressure for now,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.
Japan’s earnings season has picked up pace since Thursday and reaches a peak next week.
Robot-maker Fanuc was the worst performer on the Nikkei, sliding 5.47% after cutting its earnings forecast.
Fanuc’s report notwithstanding, corporate results have been strong overall so far, with chip-related companies standing out.
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Chip equipment maker Advantest jumped 2.39% after its results, putting it among the Nikkei’s top three performers.
Toyota-owned truckmaker Hino Motors rallied the most, surging 5.04%, followed by office electronics maker Fujitsu’s 3.14% advance, both also driven by earnings.
Among Nikkei sectors, only consumer cyclicals and utilities rose, with industrials and energy leading losses. Of the benchmark’s 225 components, 61 rose versus 159 that fell, with five flat.