Markets

Japan’s Nikkei Reverses Gains, Extends Losing Streak to Eighth Session (Update 1)

Yomiuri Shimbun file photo
Tokyo Stock Exchange

Reuters

13:23 JST, July 26, 2024 (updated at 16:20 JST)

TOKYO, July 26 (Reuters) – Japan’s Nikkei share average closed lower on Friday, reversing early gains and extending its losing streak to an eighth session, as investors adjusted positions amid uncertainties about Wall Street following a fickle session.

The Nikkei fell 0.53% to close at 37,667.41, its lowest close since April 25, after rising as much as 0.6% as investors scooped up stocks that appeared undervalued.

For the week, it fell 5.48%, marking its worst week since mid-April.

The broader Topix fell 0.38% to 2,699.54 and lost 5.28% for the week.

There were no particular negative cues for the market, but investors sold stocks to adjust positions ahead of the weekend, as the U.S. market has been volatile and there could be a big decline overnight, said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.

The S&P 500 and Nasdaq Composite ended a fickle session weaker on Thursday, failing to regain lost ground as investors grappled with the likely direction of megacaps.

The market was also cautious about the Bank of Japan’s policy decision due next week amid growing expectations that the central bank could raise its policy rate, Arisawa said.

Heavyweight chip-related stocks fell, with Tokyo Electron falling 4.77% to drag the Nikkei the most. Advantest lost 3.56%.

Renesas Electronics fell 5.48% to become the biggest percentage loser on the Nikkei, extending declines after the chipmaker reported a 29% fall in net profit for six months to June on Thursday.

The bright side was that the market bought companies that reported a positive outlook, said Shuutarou Yasuda, a market analyst at Tokai Tokyo Intelligence Laboratory.

Hino Motors surged 12.76% to become the top percentage gainer on the Nikkei after the truck maker narrowed its quarterly net loss.

With the earnings season continuing after next week, a strong corporate outlook is expected to support the Nikkei, Yasuda said.