Japan's Nikkei treads water as investors mull BOJ, Fed paths

Yokohama Rubber Co

20/02/2023 03:19

By Kevin Buckland
       TOKYO, Feb 20 (Reuters) - Japan's Nikkei share average
was nearly flat on Monday, as cautious traders awaited a week of
important U.S. and global economic data as well as testimony by
the incoming Bank of Japan (BOJ) leadership team.
    The Nikkei  .N225  edged 0.02% lower to 27,507.33 as of the
midday break, close to the middle of its range since Jan. 24.
    The broader Topix  .TOPX  gained 0.24% to 1,996.78.
    The tone was subdued after a mixed session on Wall Street on
Friday and U.S. equity futures pointed to a slightly lower
restart following Monday's national holiday.
    Energy shares led Nikkei decliners amid a slide in crude
oil, although a weakening yen lent some support to the overall
market. Earnings produced a big winner in tiremaker Yokohama
Rubber  5101.T , which soared 10.2%.
    U.S. E-mini stock futures  EScv1  ticked 0.06% lower, while
the yen was last down 0.2% to 134.365 per dollar  JPY=EBS .
    "Japanese investors are waiting for several important events
this week, making it difficult for the Nikkei to move," said
Nomura Securities strategist Maki Sawada, predicting the equity
benchmark would continue to fluctuate in a tight range around
27,500.
    Of the Nikkei's 225 components, 150 rose versus 69 that
fell, with six flat. 
    Heated U.S. economic data and on-the-whole hawish Federal
Reserve commentary have been feeding expectations of higher Fed
rates for longer. Inflation figures this week will be parsed for
further clues, as will key purchasing manager surveys from the
United States and other major economies.
    The marquee event though for Japanese markets will be BOJ
Governor nominee Kazuo Ueda lower house testimony on Friday,
which will be followed on Monday by an appearance in the upper
house.
    Although Ueda has shown himself so far to be a policy dove,
investors still expect an end to unpopular yield curve controls
during his tenure, and will watch for indications of how soon
that could be.
 (Reporting by Kevin Buckland; Editing by Rashmi Aich)
 ((Kevin.Buckland@thomsonreuters.com;))