Japan's Nikkei inched down for a fifth straight day of losses and its lowest close in three weeks on Thursday, hurt by a stronger yen after Federal Reserve Chairman Ben Bernanke expressed concern about the US economy. Market players are awaiting the results of European bank "stress tests" this week, and are divided how the Nikkei may fare after that, with some saying big falls are unlikely in the short-term since the benchmark has lost more than 5 percent in the past four days.
Charts showed oversold conditions, with the Nikkei's slow stochastic - a measure of how oversold the market is and whether it is in a short-term up or down trend - starting to flatten deep within oversold territory. The benchmark Nikkei slipped 0.6 percent, or 57.95 points to 9,220.88, its lowest close since July 2, while the broader Topix dropped 0.5 percent to 825.48.
On the technical front, the Nikkei's MACD, a measure of market momentum, was heading down after a bearish cross. But the benchmark's relative strength index (RSI) had fallen to 38, approaching oversold levels from 30 and down. Market players say support for the Nikkei likely stands firm at 9,200, just under its July 1 close, which was a seven-month closing low. After that, support lies around 9,091, a low hit this month, and 9,076, a low posted in November 2009.
Volume picked up, with 2.66 billion shares changing hands on the Tokyo exchange's first section, its highest volume in more than a month. Nearly 1.3 billion of that was shares of Mizuho Financial Group, the highest volume ever for an individual share on the Tokyo exchange's first section. Thursday was the first day investors could start trading newly-issued shares from the company's $9.6 billion share offer.
The yen's gains weighed broadly on exporters. Investors fret about a stronger yen as it eats into exporters' profits when repatriated. Digital camera maker Canon Inc fell 0.8 percent to 3,330 yen and electronics components maker TDK Corp slid 2.5 percent to 4,905 yen.
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