Tokyo shares flat ahead of European summit

TOKYO: Tokyo's benchmark Nikkei stock average finished flat on Thursday, after a day of cautious, thin trade with a strong yen hurting sentiment ahead of a key summit to address Greece's debt woes.

The benchmark Nikkei index closed up 0.04 percent or 4.49 points at 10,010.39. The Topix index of all first-section issues fell 0.06 percent or 0.55 point to 860.11.

Investors are keeping a close watch on a eurozone summit later in the day amid hopes for progress on additional aid for debt-ridden Greece, brokers said.

The Nikkei earlier slipped as the yen strengthened against the dollar, while HSBC's preliminary survey of manufacturers in China signalled a contraction in July, Toshiyuki Kanayama, market analyst at Monex, told Dow Jones Newswires.

The preliminary HSBC Manufacturing Purchasing Managers Index for China fell to a 28-month low of 48.9 in July from a final reading of 50.1 in June, raising concerns over an economic slowdown in Japan's number-one export destination.

US chip giant Intel's second quarter earnings exceeded expectations, but it trimmed its forecast for PC shipments for the year, disappointing some investors.

Tokyo Electron recovered from earlier losses to gain 0.58 percent to 4,275 yen, while Ibiden was up 0.77 percent at 2,467. However Shinko Electric Industries fell 0.14 percent to 704.

US stocks fell slightly on Wednesday as investors waited for a resolution to the debt-ceiling standoff in Washington and digested a mixed bag of second-quarter earnings reports.

The Dow Jones Industrial Average shed 0.12 percent or 15.51 points to close at 12,571.91.

A relatively firmer yen against the dollar put pressure on major exporters, offsetting positive sentiment earlier in the day from the release of data showing Japan posted its first trade surplus in three months in June, signalling faster-than-expected post-quake recovery.

Toyota fell 0.45 percent to 3,310 yen and Honda was down 0.62 percent at 3,165 yen.

Notable losers among technology firms were TDK, down 2.17 percent at 4,280 yen, and Panasonic, down 2.73 percent at 925 yen.

Shares in Tokyo Electric Power Co., the operator of the Fukushima Daiichi nuclear plant at the centre of an ongoing nuclear crisis, soared 15.91 percent to 590 yen.

The issue got a boost after the Nikkei business daily said ruling and opposition parties broadly agreed the government will provisionally pay more than half of compensation costs arising from the crisis at the Fukushima plant.

Copyright AFP (Agence France-Presse), 2011