Tokyo shares snapped a two-day rally Tuesday with energy firms hit by a drop in oil prices and low-volume trading. Oil extended the previous day's sharp losses stoked by concerns a pick-up in output from Iraq and Nigeria will compound a global oversupply problem. Traders are now awaiting a speech by Federal Reserve chief Janet Yellen at the Jackson Hole symposium of global central bankers on Friday, hoping she will give some clues about US monetary policy.
"With investors waiting for Yellen, it's unlikely that we'll see a strong direction in the stock market," Toshihiko Matsuno, a senior strategist with SMBC Friend Securities, told Bloomberg News. "(But) oil, which had been rebounding, has started to correct again," dampening demand for energy shares. The benchmark Nikkei 225 index fell 0.61 percent, or 100.83 points, to close at 16,497.36, while the broader Topix index of all first-section shares lost 0.47 percent, or 6.12 points, to 1,297.56.
In forex markets, the dollar slipped to 100.10 yen from 100.32 yen in New York, weighing on exporters including Toyota and Honda. The greenback has been see-sawing this week as divergent views from Fed officials keep markets guessing about the possibility of a rate hike by the US central bank in the near future.
While hawkish weekend remarks from the Fed's vice chairman Stanley Fischer boosted the dollar on Monday, gains have largely been capped on uncertainty about the chances of an increase in borrowing costs this year. A rise in the yen against the dollar is a negative for Japan Inc, making exporters less competitive and hurting their profitability. Energy explorer Inpex fell 2.22 percent to 886.6 yen and refiner JX Holdings slumped 2.39 percent to 383.4 yen. Toyota was off 1.68 percent at 5,997 yen, while Honda lost 2.07 percent to end at 3,066 yen. Uniqlo operator Fast Retailing, a market heavyweight, dropped 1.08 percent to 36,580 yen.
Comments
Comments are closed.