Tokyo shares sank Wednesday, ending a six-day winning streak, with Nintendo plunging on profit-taking after more than doubling this month on the back of the Pokemon Go phenomenon. The videogame giant slumped almost 13 percent to 27,765 yen, just a day after it overtook Sony in market value, while Japanese fans were left disappointed after a rumoured release in the country Wednesday proved wrong.
A gaming website Tuesday had flagged the launch in Nintendo's home market, but it bactracked within a day, saying it would likely come out Thursday, having hit shelves in more than two dozen countries by the weekend. Nintendo's shares had more than doubled since Pokemon Go's release this month sparked a global frenzy, and boosted hopes for the company's move into mobile gaming. Nintendo and the Pokemon Company declined to comment on the release date, while US-based Niantic - which developed the game - has not replied to requests for comment.
Forbes has cited Niantic chief executive John Hanke as saying the reason for the delay is that Japan's server capacity is not powerful enough to keep up with expected demand. However, McDonald's Japan surged 9.84 percent to 3,515 yen on news it will sponsor Pokemon Go in Japan, according to the Wall Street Journal. Tokyo's benchmark Nikkei 225 index closed the day 0.25 percent, or 41.42 points, lower at 16,681.89, having surged more than 10 percent over the previous six trading days on the back of an expected government stimulus boost and a weak yen.
The Japanese unit has lost six percent against the dollar since a strong US jobs report on July 8. The broader Topix index of all first-section shares edged down 0.05 percent, or 0.64 points, to 1,330.75. "Considering there aren't any real catalysts for share moves and that the Nikkei 225 has risen far above its 25-day moving average, the market needs a breather," Chihiro Ohta, a senior strategist at SMBC Nikko Securities, told Bloomberg News. "Nintendo shares need a break, too."
Some exporters slumped with Sony dipping 0.12 percent to 3,232 yen while Toyota fell 0.15 percent to 5775 yen, despite the weakening yen. Banking giant Mitsubishi UFJ dropped 2.05 percent to 510.9 yen. Messaging app Line, which made its trading debut in Tokyo on Friday, jumped 2.13 percent to 4,075 yen. SoftBank ticked up 0.41 percent to 5,409 yen, rebounding from a 10 percent plunge Tuesday in reaction to the Japanese firm's whopping $32 billion purchase of British iPhone chip designer ARM Holdings. Investors turned up their nose at the steep purchase price, and some analysts scratched questioned an acquisition that seemed out of line with SoftBank's previous investments.
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