Japan’s Nikkei Stock Average Falls as Traders Book Profits after Four-session Rally; US Payrolls Data Awaited (Update 1)

Reuters

13:10 JST, December 6, 2024 (updated at 16:35 JST)

TOKYO (Reuters) – Japan’s Nikkei share average slipped on Friday as investors locked in profits after four days of gains, while awaiting a key U.S. jobs report later in the day.

Chip stocks were standout losers, dragged down by declines in their Wall Street peers overnight.

The Nikkei .N225 shed 0.77% to finish the day at 39,091.17, after briefly dipping below the psychological milestone of 39,000. For the week, however, the index closed up by about 2.3%.

Chip-testing equipment maker Advantest 6857.T, an Nvidia supplier, sagged 3.25% to lose the most points on the Nikkei. Chip-making machinery giant Tokyo Electron 8035.T slid 2.58%.

The broader Topix .TOPX, which has a lower concentration of tech shares, declined 0.55%. A sub-index of growth stocks .TOPXG dropped 0.73%, against a 0.37% retreat in value stocks .TOPXV.

“After four consecutive days of gains, caution in the market is increasing,” said Kazuo Kamitani, an equities strategist at Nomura.

“More and more investors are stepping back to wait for the U.S. payrolls report.”

Monthly non-farm payrolls data will be carefully parsed later in the day for fresh indications of the Federal Reserve’s interest rate path, with market-implied odds currently at around 73% for a quarter-point cut on Dec. 18.

Meanwhile, a stabilization in the yen exchange rate at around 150 per dollar JPY=EBS boosted automakers, which had been pushed to multi-year lows in some cases on the currency’s rapid climb to a nearly two-month high earlier this week.

Nissan 7201.T gained 2.65% and Mazda 7261.T rose 1.54%. Toyota 7203.T was an outlier, with a 0.11% decline.

Airlines .IAIRL.T were the top performers among the Tokyo Stock Exchange’s 33 industry groupings, gaining 0.73% as crude oil prices were depressed amid a focus on weak demand.