Tue, 03 Aug 2021

TOKYO, June 17 (Xinhua) -- Tokyo stocks closed lower Thursday as technology and pharmaceuticals came under heavy selling pressure following the U.S. Federal Reserve indicating it would hike its rates earlier than expected.

The 225-issue Nikkei Stock Average gained 272.68 points, or 0.93 percent, from Wednesday to close the day at 29,018.33.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, added 12.29 points, or 0.62 percent, to finish at 1,963.57.

Following Wall Street's weak lead overnight as the Fed indicated an earlier-than-expected hike to its interest rates, which triggered concerns that stimulus measures could be tapered at an earlier juncture, stocks here retreated throughout the day, brokers here said.

"Investors seems to be overreacting to the Fed's announcement, and the declines in U.S. stocks," Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities, was quoted as saying.

"But it is understandable, because the U.S. market may fall again tonight as the market might not have fully digested the Fed's announcement, which was made right before the close," said Arisawa.

Strategists here said that losses were trimmed by investors seeking out issues oversold in late trade, with Masahiro Yamaguchi, head of investment research at SMBC Trust Bank, saying that "stocks are not expected to fall much further" as a result of the Fed's meeting.

In terms of the currency market, meanwhile, the U.S. dollar hit the 110.82 yen level at one point and at 5:00 p.m. was quoted at 110.59-60 yen compared with 110.66-76 yen in New York and 109.93-94 yen at 5:00 p.m. on Wednesday in Tokyo.

The euro, meanwhile, fetched 1.1954-1955 dollars and 132.20-24 yen against 1.1990-2000 dollars and 132.75-85 yen in New York and 1.2132-2133 dollars and 133.37-41 yen in late Wednesday afternoon trade in Tokyo.

By the close of play, service, precision instrument and pharmaceutical stocks comprised those that declined the most, and issues that fell outpaced those that rose by 1,409 to 673 on the First Section, while 111 ended the day unchanged.

Tech-related issues losing ground included Nikkei heavyweight SoftBank Group dropping 1.4 percent, while Sony Group dropped 2.3 percent. Internet-based medical services provider M3, meanwhile, closed 3.6 percent lower.

Financial issues found favor, however, as U.S. Treasury yields gained, with Mizuho Financial Group adding 0.9 percent, while Mitsubishi UFJ Financial Group rose 1.2 percent. Sumitomo Mitsui Financial Group, meanwhile, closed the day 0.8 percent higher.

Similarly, insurers also gained traction, with Dai-ichi Life Holdings jumping 2.5 percent, while T&D Holdings, the Nikkei's biggest gainer, leaped 3.1 percent by the close.

On the main section on Thursday, 997.59 million shares changed hands, dropping from Wednesday's volume of 1,028.48 million shares.

The turnover on the penultimate trading day of the week came to 2,278.22 billion yen (20.58 billion U.S. dollars).

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