Japan's Nikkei retreats from 6-week high as investors lock in gains
TOKYO: Japan's Nikkei 225 retreated from a six-week high on Friday as investors locked in gains and turned cautious over the outlook for interest rates, inflation, and geopolitical risks.
Tokyo saw Japan's Nikkei 225 retreat from a six-week high on Friday, as investors cashed in profits and grew more cautious about interest rates, inflation, and geopolitical risks. The benchmark fell 0.94% to 68,309.46, marking a weekly gain of 2.9%. The broader Topix index dipped about 1% to 4,091.00. US stocks gained overnight, but the mood remained uncertain, as traders kept a close eye on the Federal Reserve's potential rate path and inflation concerns.
In Japan, core inflation in Tokyo surged in September, the fastest pace in ten months, suggesting a need for further rate increases. Geopolitical tensions, such as the US-Iran conflict and China's suspension of oil exports to Hong Kong and Macau, added to the market's unease. Following a 3.3% surge on Thursday, profit-taking is expected, according to Yuta Okamoto, an analyst at Tokai Tokyo Intelligence Laboratory.
The outlook for domestic stocks remains positive, he noted, citing the Bank of Japan's tankan survey, which showed manufacturing sentiment at a six-quarter high. More stocks fell than rose in the Nikkei 225, with 173 declining and 51 advancing. The biggest losers were SoftBank Group, down 5.83%, Nissan Motor, down 4.97% and hitting its lowest close since February 2009, and Terumo, which dropped 4.59%.
Resonac Holdings led the gainers, up 8.71%, followed by Furukawa Electric, up 7.68%, and Baycurrent, which increased 6.15%.
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