Japan’s Nikkei Stock Average Ends at 6-month Low as Tech Shares Fall, Stronger Yen Weighs (Update 1)

Reuters

12:23 JST, March 7, 2025 (updated at 16:20 JST, Mar. 7)

TOKYO (Reuters) – Japan’s Nikkei share average fell more than 2% to end at a six-month low on Friday, as technology stocks tracked Wall Street declines and a stronger yen weighed on exporters.

The Nikkei .N225 closed down 2.17% at 36,887.17, its lowest close since September 18, after touching 36,813.62 during the session, also its lowest intraday level since that day.

The index lost 7.5% so far this year to become the second-worst performer among major Asian markets.

The broader Topix .TOPX slipped 1.56% to 2,708.59.

Wall Street stocks finished lower overnight, with the Nasdaq confirming it has been in a correction since December on the uncertainty surrounding U.S. trade policy.

The Nasdaq has fallen 10.4% from a record-high close on December 16. An index of chipmakers <.SOX>dropped 4.5% on Thursday.

“We saw some negative cues for Japanese shares, including overnight declines in U.S. stocks and a stronger yen,” said Kentaro Hayashi, a senior strategist at Daiwa Securities.

Uniqlo-brand owner Fast Retailing 9983.T slipped 3.64% to drag the Nikkei the most, while chip-related Tokyo Electron 8035.T and Advantest 6857.T lost 3% and 2.34%, respectively.

Automakers also fell after the yen JPY=EBS strengthened against the dollar amid safe-haven bets.

Toyota Motor 7203.T and Honda Motor 7267.T lost 0.69% and 0.56%, respectively.

A stronger Japanese currency tends to hurt shares of exporters, as it decreases the value of overseas profits in yen terms when firms repatriate them to Japan.

Renewed expectations for the Bank of Japan’s interest hikes weighed on sentiment after the market saw signs of strong wage growth, said Naoki Fujiwara, a senior fund manager at Shinkin Asset Management.

Japan’s largest labor union umbrella group, Rengo, is seeing its member unions demand the biggest salary increase in over 30 years. Wages are seen as a key gauge for the BOJ’s rate path.

Of the more than 1,600 shares trading on the Tokyo Stock Exchange’s prime market, 28% rose, 69% fell and 2% traded flat.