Japanese shares hover near session high on hints of Fed rate pause

Ebara

23/03/2023 07:15

By Yantoultra Ngui
       SINGAPORE, March 23 (Reuters) - Japan's Nikkei share
average closed lower on Thursday, although it hovered near the
session high amid a recovery in broader Asian markets as
investors assessed the U.S. Federal Reserve's hints of a pivot
on its policy tightening.  
    The Nikkei index  .N225  ended 0.17% lower at 27,419.61, but
hovered close to the day's high of 27,461.97. The broader Topix
 .TOPX  closed 0.29% weaker at 1,957.32, but held ground near
the session's high of 1,960.14.
    Japanese shares tracked an overnight slump in Wall Street,
mainly dampened by remarks from U.S. Treasury Secretary Janet
Yellen who told lawmakers that she had not considered or
discussed "blanket insurance" for U.S. banking deposits without
approval by Congress.
    Market sentiment was further weighed down by Fed Chair
Jerome Powell's comment that the U.S central bank would do
"enough" to tame inflation.
    "This month's flare-up in financial stability is set to
tighten lending conditions and hurt growth," said Mansoor
Mohi-uddin, chief economist at the Bank of Singapore. "We
continue to see U.S. recession this year."
    "Investors should remain cautious on risk assets, expect a
weaker U.S dollar as Fed rate hikes peak, and keep favouring
high-quality bonds as safe-haven hedges against recession
risks," he added.
    Investor focus is also on the Bank of England, which was
widely expected to raise rates again after a surprise jump in
inflation.
    In Japan, the yen  JPY=EBS  strengthened 0.60% to 130.64 per
dollar on Thursday.
    Financials Chiba Bank Ltd  8331.T  and Mitsubishi UFJ
Financial Group Inc  8306.T  were among the laggards in the
Nikkei, ending down 1.75% and 1.36%, respectively.
    Recruitment firm Recruit Holdings Co Ltd  6098.T  and
vehicle maker Suzuki Motor Corp  7269.T  closed 4.78% and 2.12%
higher, respectively.
    Suzuki's upbeat performance came in after Citi raised its
stock target price to 6,400 yen per share from 5,500 yen, and
retained its "buy" rating.    
    Gainers, however, beat losers by 115 to 100, while 10
remained unchanged.
    On the Topix, hotels operator Agora Hospitality Group Co Ltd
 9704.T  and artificial intelligence company HEROZ Inc  4382.T 
were among the top losers.
    Technology firm MegaChips Corp  6875.T  and semiconductor
company Axell Corp  6730.T  were the biggest gainers with a jump
of 13.85% and 14.97%, respectively.
    Gainers in the Topix outpaced losers by 1,256 to 781, with
122 trading flat.
    

 (Reporting by Yantoultra Ngui; Additional reporting by Ankur
Banerjee in Singapore and Daniel Leussink in Tokyo; Editing by
Sherry Jacob-Phillips)
 ((Yantoultra.Ngui@thomsonreuters.com;))