Nikkei snaps 7-day winning streak

Reuters Tokyo | Updated on September 26, 2018 Published on September 26, 2018

Toyota Motor Corp fell 2.0 per cent.

About 155 points are cut by ex-dividend adjustment: market participants

Japan's Nikkei fell on Wednesday morning, snapping a seven-day winning streak as high-yielders such as automakers traded ex-dividend, while chip-related stocks were hit by weakness in their US peers overnight.

The Nikkei share average dropped 0.3 per cent to 23,875.65 in midmorning trade, after gaining 5.9 per cent since September 13.

About 155 points were cut from the Nikkei by the ex-dividend price adjustment, according to market participants. High-yielding stocks, including automakers, as well as banks and securities firms underperformed.

Toyota Motor Corp fell 2.0 per cent, Nissan Motor Co tumbled 4.3 per cent, Mizuho Financial Group declined 2.8 per cent, Sumitomo Mitsui Financial Group shed 2.4 per cent and Nomura Holdings slid 2.2 per cent.

Trump to meet Japanese PM

Analysts said that the market is focused on the outcome of a scheduled summit between Japanese Prime Minister Shinzo Abe and US President Donald Trump on Wednesday in New York.

On Tuesday, the two countries had reached a broad understanding over how to promote bilateral trade and may announce specifics on Wednesday, Economy Minister Toshimitsu Motegi was quoted as saying after meeting US Trade Representative Robert Lighthizer.

Speaking to reporters in New York after his second round of trade talks with Lighthizer, Motegi said he hoped to give more details after the summit, Kyodo News reported. Analysts say investors are not overly nervous about how the summit will turn out, but they remain cautious.

“Trump has said provocative things to other countries, so you never know. The market seems to be calm now but they haven't turned on their risk stance yet,” said Tetsuro Ii, the president of Commons Asset Management.

Trump has made clear he is unhappy with Japan's $69 billion trade surplus with the United States - nearly two-thirds of it from auto exports - and wants a two-way agreement to address it.

Chip equipment maker Tokyo Electron slid 2.9 per cent and silicon products maker Sumco Corp dropped 1.1 per cent, after the Philadelphia semiconductor index dropped 1.70 per cent overnight.

Takeda Pharmaceutical bucked the weakness, rising 1.9 per cent to a 4-1/2-month high of ¥4,849 after Daiwa Securities raised its stock rating to 'outperform' from 'neutral' to price in the impact from its purchase of Shire PLC, saying that despite increased shares outstanding, value per share will be unchanged. The broader Topix shed 0.7 per cent to 1,810.42.

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Published on September 26, 2018
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