Japanese stocks end lower ahead of Fed policy meeting

TOKYO: Japanese shares ended lower on Tuesday as investors remained on the sidelines ahead of a pivotal U.S. Federal Reserve meeting that could reveal more about its plans to taper stimulus measures and hike rates.

The Nikkei share average fell 0.43% to 29,520.90, a day after posting its biggest daily gain since June following a solid election victory by Prime Minister Fumio Kishida’s ruling coalition. The broader Topix lost 0.64% to 2,031.67.

“The market is looking to what the Federal Reserve will do with its tapering,” said Yuya Fukue, a trader at Rheos Capital Works.

“While November tends to be a good month for stocks, the stock market could be vulnerable if the pace of the Fed’s tapering is quicker than expected.”

The Fed will announce its policy decision at the end of its two-day meeting on Wednesday when Japanese markets will be shut for a public holiday.

Domestic earnings results also weighed on markets, as Pola Orbis dropped 6.8% after the cosmetics maker reported disappointing quarterly results.

Ship builder Hitachi Zosen lost 6.6%, while drugmaker Kyowa Kirin shed 6.4% also on earnings disappointment.

Trading house Mitsui & Co dropped 4.0% after its quarterly results came in line with analyst forecasts but rival Marubeni rose 3.4% after a consensus-beating earnings.

Other gainers included electronic parts makers TDK Corp and Kyocera that jumped 8.7% and 5.3%, respectively, on brisk results.

Dexerials rose by its daily limit of 21.4%, after the maker of the optical and electronic materials posted strong profits, and announced a pidend hike and stock buyback plan.

Still, decliners outnumbered gainers by a ratio of 3 to 1 and all but four of the Topix 33 industry subindexes were in the red as a wide range of shares came under pressure from profit-taking ahead of a market holiday.

Nikkei erases early losses to end flat amid strong earnings

TOKYO: Japan’s Nikkei share average recovered from early declines to end Wednesday little changed as strong earnings supported the market despite overall caution ahead of a parliamentary election on the weekend.

The Nikkei slipped less than 8 points to close at 29,098.24, maintaining most of the previous days surge of about 500 points. The index earlier sank as low as 28,870.25.

The broader Topix, though, slipped 0.23% to 2,013.81, with 24 of its 33 subsectors declining.

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“Stock investors have a need to buy now so they are picking up names with strong earnings results, supporting the broader market,” said a market participant at a domestic securities firm.

“On the other hand, there’s a worry the market overall could see some selling off.”

Shinko Electric Industries led gainers on the Tokyo bourse with a 14.9% surge, followed by electronics parts-maker Maruwa’s 12.4% jump, after both impressed with corporate results.

Shimano advanced 8.2%, speciality chemicals company Nitto Denko gained 7.3% and

Hitachi

Construction Machinery added 7.1%, also on the back of strong earnings.

At the other end, Canon dropped 5.9% and precision motor-maker Nidec slid 2.9% after posting disappointing results.

At the same time, investors remained cautious as the new prime minister, Fumio Kishida, prepared to lead his Liberal Democratic Party into lower house elections on Sunday.

The LDP is expected to retain an overall majority while losing some seats but a shock by-election loss last weekend has injected an additional level of uncertainty into the contest.

“If the LDP can’t secure a majority by itself, that will weaken Kishida’s position and lead to political instability,” said Masayuki Kichikawa, chief macro strategist at Sumitomo Mitsui Asset Management.

“Many will wonder if the party can survive the upper house election next year,” said Kichikawa, referring to LDP members who could then decide to oust Kishida.

Meanwhile, the Tokyo Stock Exchange announced on its website that it was looking to extend trading hours by half an hour in the latter half of 2024, closing at 3:30 p.m. (0630 GMT) instead of the current 3:00 p.m.