Nikkei Eases Off 29-1/2-year High On Profit-taking

TOKYO: Japan shares closed lower on Monday, with the Nikkei pulling back from a more than 29-1/2-year high, as five straight weeks of gains raised some concerns of an overheating market and spurred investors to book profits.

The Nikkei index fell 0.76% to 26,547.44, after hitting its highest level since April 1991 at the open. The broader Topix lost 0.86% to 1,760.75.

Tokyo stocks initially tracked positive cues from Wall Street’s Friday session before reversing course on profit-taking.

Major U.S. stock indexes rose to all-time highs last week as downbeat U.S. jobs data raised expectations for a new fiscal relief bill. [.N]

Back home, Prime Minister Yoshihide Suga said he would decide on an economic stimulus package early this week, adding that green and digital initiatives would be core to the recovery from the coronavirus pandemic.

Local stocks have been prone to profit-booking due to persistent concerns of an overheating market, some market participants said.

Other headwinds for the market included rising coronavirus cases in Japan and falls in U.S. stock futures on the back of growing concerns over tensions between China and the United States.

Reuters exclusively reported, citing sources, that the United States was preparing sanctions on Chinese officials over their alleged role in Beijing’s disqualification of elected opposition legislators in Hong Kong.

Among the Topix 30 underperformers, Shin-Etsu Chemical Co Ltd fell 2.62% and Nidec Corp lost 2.22%.

The top percentage losers in the index were Olympus Corp, ANA Holdings and Kawasaki Kisen Kaisha, falling between 5.06% and 5.32%.

Semiconductor stocks tracked their U.S. peers higher, with Advantest edging 0.54% higher and Tokyo Electron adding 1.4%.

Dentsu Group Inc rose as much as 1.13% before closing down nearly 0.6%, after the Japanese advertising giant said it was expecting a smaller net loss for the year ending in December compared to the prior year.

Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

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