Japan’s Nikkei snaps 5-day winning streak on inflation concerns – Macau Business

Japans Nikkei stock index snapped a five-day winning streak Friday following a weak lead from Wall Street overnight and as concerns over central banks aggressive monetary policies to combat inflation dented sentiment.

The 225-issue Nikkei Stock Average dropped 422.24 points, or 1.49 percent, from Thursday to close the day at 27,824.29.

The broader Topix index, meanwhile, lost 25.96 points, or 1.32 percent, to finish at 1,943.09.

Brokers here said that investors were in a risk-off mood from the get-go following Wall Streets plunge overnight.

They said that investors offloaded a broad range of issues following the markets recent run of gains, to secure profits.

The jittery mood was, however, predominantly due to concerns about the economic outlook for the region after the European Central Bank (ECB) announced Thursday it plans to hike its interest rates by 0.25 percentage point, possibly as early as next month and with further hikes possible after that.

Strategists here also pointed out that as the U.S. Federal Reserve and the Bank of England raised their rates, concerns have been rising abut the outlook for the global economy amid rising inflation.

Market participants feared the impact on the global economy as the central banks of both the United States and Europe have entered a phase of aggressive interest rate hikes, Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management Co., was quoted as saying.

Ahead of the Feds two-day policy setting next week, dealers here also noted that some investors hit the sidelines to await the release of the U.S. consumer price index for May later today.

By the close of play, precision instrument, machinery, and oil and coal product issues comprised those that declined the most, while issues that fell outpaced those that rose on the Prime Market by 1,634 to 176, while 28 ended the day unchanged.

Following the tech-heavy Nasdaqs overnight slide, their Japanese peers lost ground in Tokyo trading, with Tokyo Electron dropping 3.2 percent, while Advantest fell 4.2 percent.

Screen Holdings, meanwhile, ended the day 4.8 percent lower.

Heavily weighted Nikkei issues lost ground, with Uniqlo store operator Fast Retailing slipping 0.9 percent, while tech investor SoftBank Group lost 2 percent.

On the Prime Market on Friday, 1,272.53 million shares changed hands, dropping from Thursdays volume of 1,287.27 million shares.

The turnover on the last trading day of the week came to 3,144.95 billion yen (23.47 U.S. dollars).

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Japan's Nikkei snaps 5-day winning streak on inflation concerns - Macau Business