Japan's Nikkei ekes out gains as profit-taking, yen risk weigh

SumCo

02/04/2024 07:57

(Updates with closing levels)
    By Brigid Riley
       TOKYO, April 2 (Reuters) - Japan's Nikkei share average
closed higher on Tuesday, briefly scaling 40,000 points before
profit-taking and the risk of currency intervention by Japanese
authorities hemmed in gains.
    The Nikkei  .N225  finished the day up 0.1% at 39,838.91.
    The index is up about 19% this year and scaled the 40,000
mark to record highs last month, although profit booking pushed
it to a two-week low on Monday.
    Traders took advantage of the drop to buy stocks, with many
companies getting a boost before profit-taking set in again to
limit gains.
    Uniqlo parent firm Fast Retailing  9983.T  eked out a 0.1%
gain, while Toyota Motor  7203.T  erased earlier gains to finish
0.2% down.
    Chip-making equipment giant Tokyo Electron  8035.T ,
meanwhile, held onto gains, rising 3.4%.
    Technology-related stocks received a tailwind from their
U.S. peers as the AI frenzy continued to boost the U.S.
semiconductors index  .SOX .
    Chip-testing equipment maker Lasertec  6920.T  gained 1.9%,
while Sumco Corp  3436.T , which produces silicon used for
semiconductor manufacturers, was the best performer, rising
4.4%.
    Along with profit-taking, the index's gains were also capped
as the risk of currency intervention lingered, with the yen
continuing to trade around 151.72 per dollar  JPY= .
    That's created a "heightened sense of caution" in the
market, said Masahiro Ichikawa, chief market strategist at
Sumitomo Mitsui DS Asset Management. 
    "If the yen were to appreciate rapidly due to intervention,
there is a strong possibility that the Nikkei could fall." 
        Japanese Finance Minister Shunichi Suzuki said on
Tuesday that authorities were ready to take appropriate action
against excessive currency market volatility, without ruling out
any options.
    The intervention risk could make it difficult for the index
to keep in the 40,000-point range for now, although it could get
another boost when corporate earnings season gets into swing
later this month, Ichikawa said.
    The broader Topix  .TOPX  closed down 0.25% at 2714.45.     

 (Reporting by Brigid Riley; Editing by Savio D'Souza and Janane
Venkatraman)
 ((brigid.riley@thomsonreuters.com;))