Japan's Nikkei snaps 3-day winning streak as yen jumps after Fed's decision

Recruit Holdings

14/12/2023 06:29

(Updates with closing prices)
       TOKYO, Dec 14 (Reuters) - Japan's Nikkei share average
snapped a three-day winning streak on Thursday, as automakers
and banking stocks fell after the Federal Reserve's signal to
end its tightening cycle boosted the yen sharply and pushed U.S.
Treasury yields lower.
    The Nikkei  .N225  ended 0.73% lower at 32,686.25 after
rising as much as 0.6% earlier in the session. The index opened
higher tracking overnight Wall Street gains. 
    The Dow Jones industrial average hit its first record
closing high since January 2022 after the Fed flagged its
interest rate-hiking policy is at an end.  .N 
    The Japanese yen  JPY=EBS  hit a four-and-half-month high
against the dollar, while the U.S. benchmark 10-year bond yield
extended declines in Asian hours after hitting its lowest since
August overnight.
    A stronger yen tends to hurt exporter shares as it decreases
 the value of overseas profits in yen terms when firms
repatriate them to Japan.
    "Japanese equities fell due to the yen's strength and
falling Treasury yields. The Fed decision was more dovish than
expected," Takehiko Masuzawa, head of trading, Phillip
Securities Japan, said.
    The broader Topix  .TOPX  fell 1.43% to 2,321.35.
    The auto and autoparts sector  .ITEQP.T  lost 3.98%, its
biggest daily decline since Oct. 4, to become the worst sector
among the Tokyo Stock Exchange's 33 industry sub-indexes. 
    Toyota Motor  7203.T  lost 3.82% to become the biggest drag
on Topix. Honda Motor  7267.T  fell 5%. 
    The banking sector  .IBNKS.T  slipped 3.82% with Mitsubishi
UFJ Financial  8306.T  and Sumitomo Mitsui Financial Group
 8316.T  losing 3.54% and 5.25%, respectively.
    The insurance index  .IINSU.T  was down 3.62%.
    "It was natural that those sectors fell after the Fed's
decision but all the bad market cues were out so far. Investors
are now eyeing the Bank of Japan's (BOJ) policy meeting," said
Phillip Securities Japan's Masuzawa.
    The BOJ is scheduled to hold its two-day policy meeting
starting Monday.
    Recruit Holdings  6098.T  jumped 7.21% after the staffing
agency announced a buy back of up to 200 billion yen ($1.41
billion) of its own stocks.

($1 = 142.1600 yen)

 (Reporting by Junko Fujita; Editing by Rashmi Aich and Mrigank
Dhaniwala)
 ((junko.fujita@thomsonreuters.com;))