Tokyo stocks closed flat Tuesday on profit-taking after several days of gains, while Sharp tumbled on a report that said the struggling electronics maker is seeking aid from its key lenders and may close some money-losing units. The Nikkei 225 index at the Tokyo Stock Exchange slipped 0.06 percent, or 11.72 points, to end at 18,815.16, while the Topix index of all first-section issues rose 0.12 percent, or 1.86 points, to 1,526.83.
The benchmark index opened 0.44 percent higher on a weak yen and record-setting advances on Wall Street. But it later retreated as the yen picked up and caution grew amid a string of gains that have pushed the Nikkei to 15-year highs. "Half of the investors are waiting for a pullback to buy and the other half are just buying," Andrew Clarke, director of trading at Hong Kong brokerage Mirabaud Asia, told Bloomberg News.
"The longer trend is up on earnings expectations, but in the near-term, because the market has done well, the expectation of some profit taking is normal and healthy." The dollar bought 119.58 yen in afternoon forex trade, slipping from 120.17 yen in New York. A stronger yen is a negative for Japanese exporters as it makes them less competitive abroad and erodes the value of repatriated profits. Embattled electronics maker Sharp closed down 3.54 percent at 245.0 yen after plunging nearly 10 percent in opening trade.
The drop came after the Nikkei business daily reported that the firm plans to request aid from two main lenders, including a 150 billion yen debt-for-equity swap. The firm's lenders were also down with Mizuho Financial Group falling 1.00 percent to 217.8 yen while Mitsubishi UFJ eased 1.05 percent to close at 759.5 yen. On Wall Street, the Nasdaq finished above 5,000 Monday for the first time in 15 years, capping a long-running recovery in the exchange after the dot-com bubble burst in 2000. Both the Dow and the S&P 500 also ended at record highs.
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