Nikkei slips on soft earnings, U.S. tech worries

UBE

25/10/2021 08:28

(Updates with closing prices)
    TOKYO, Oct 25 (Reuters) - Japanese stocks dropped on Monday
on disappointing earnings, with semiconductor-related shares
among the hardest hit, taking their cue from falls in U.S. tech
firms on poor earnings and concerns about the Federal Reserve's
tapering.
    The Nikkei 225 Index  .N225  fell 204 points or 0.71% to
28,600.41, at one point slipping below 28,500 to a 10-day low.
The broader Topix  .TOPX  was down 0.34 % at 1,995.42. 
    Semi-conductor stocks  .MIJP0SE00PJP  lost 0.94%, with Tokyo
Electron  8035.T  down 1.2% and Screen Holdings  7735.T  falling
2% after U.S. Nasdaq shares  .IXIC  fell on Friday on
disappointing quarterly reports from Snap  SNAP.N  and Intel
Corp  INTC.O .  .N 
    The stocks that gained the most among the top 30 core Topix
names included Recruit Holdings Co Ltd  6098.T , while
underperformers included SoftBank Group Corp  9984.T , which was
down 3.37%.
    Japan's ruling coalition's defeat in Sunday's by-election
was a surprise and discouraged market players from buying ahead
of this week's general election, Koichi Kurose, chief strategist
at Resona Asset Management, said.
    The national election https://www.reuters.com/world/asia-pacific/main-parties-contesting-japans-lower-house-poll-2021-10-07
 on Oct. 31 is key to whether new Prime Minister Fumio Kishida
is able to go ahead with big spending plans for the economy,
which is showing some signs of recovery.
    The ruling Liberal Democratic Party (LDP) and its junior
coalition partner currently have a near two-thirds majority of
the 465 seats in the house. Kishida is hoping they retain a
majority, despite an opposition candidate winning one of two
upper house by-elections  urn:newsml:reuters.com:*:nL1N2RL07F at the weekend.
    Richly-valued U.S. tech shares had also come under pressure
after Federal Reserve Chair Jerome Powell discussed stimulus
tapering.  urn:newsml:reuters.com:*:nL1N2RI1MV
    Some Japanese corporate earnings on Friday also struck a
downbeat note and Canon Electronics  7739.T  was flat after
nine-month earnings fell well short of the full 2021 targets.
    Ube Industries  4208.T  dropped 3.4% after the chemical firm
trimmed its annual net profit outlook even as it boosted its
top-line forecast.  urn:newsml:reuters.com:*:nXB19LN0FP
    Stanley Electric  6923.T  ended flat after the maker of
automobile lighting equipment maker lowered its earnings outlook
for the half year that ended in September, citing a global
plunge in car production and rising costs.  urn:newsml:reuters.com:*:nXB1Q8MOBJ
    But Tokyo Steel  5423.T  jumped almost 16% after the
steelmaker bumped up its annual profit outlook and boosted
dividend estimates.  urn:newsml:reuters.com:*:nXB0MYBP8R
    Chugai Pharmaceutical  4519.T  rose 10.4% after the
drugmaker posted upbeat earnings due to its cocktail treatment
for COVID-19.  urn:newsml:reuters.com:*:nXB0RVZG7U. 

 (Reporting by Hideyuki Sano; Additional reporting by Tokyo
Markets team and Vidya Ranganathan; Editing by Alexander Smith)
 ((hideyuki.sano@thomsonreuters.com; +81 3 4520 1195;))