Japanese Market Modestly Lower

The Japanese stock market is trading modestly lower on Wednesday, extending the losses in the previous three sessions, following the broadly negative cues from Wall Street overnight. The Nikkei 225 is falling to near the 38,300 level, with weakness in index heavyweights, technology and financial stocks.

Traders also reacted to domestic data that showed manufacturing sentiment in Japan turned negative in February 2024, for the first time in ten months.

The benchmark Nikkei 225 Index is down 58.66 or 0.15 percent at 38,304.95, after hitting a low of 38,130.57 earlier. Japanese stocks ended modestly lower on Tuesday.

Market heavyweight SoftBank Group is losing more than 2 percent, while Uniqlo operator Fast Retailing is gaining almost 1 percent. Among automakers, Honda is edging down 0.1 percent, while Toyota is edging up 0.4 percent.

In the tech space, Advantest is losing more than 3 percent and Tokyo Electron is declining more than 1 percent, while Screen Holdings is gaining almost 1 percent.

In the banking sector, Mizuho Financial, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are losing almost 1 percent each.

Among the major exporters, Sony is losing more than 1 percent and Mitsubishi Electric is declining almost 2 percent, while Canon is adding almost 1 percent. Panasonic is flat.

Among other major losers, Sumitomo Pharma is losing more than 4 percent, Pacific Metals is declining almost 4 percent and Dowa Holdings is down more than 3 percent, while Dai-ichi Life and T&D Holdings are slipping almost 3 percent each.

Conversely, Aozora Bank is soaring almost 8 percent and Kawasaki Kisen Kaisha is gaining more than 3 percent, while Hitachi Zosen, Terumo, Rakuten Group, BANDAI NAMCO and Mitsui O.S.K. Lines are advancing almost 3 percent each.

In economic news, Japan posted a merchandise trade deficit of 1,758.3 billion yen in January, the Ministry of Finance said on Wednesday. That beat forecasts for a shortfall of 1,925.9 billion yen following the 62.1 billion yen surplus in December.

Exports climbed 11.9 percent on year to 7.332 trillion yen – beating forecasts for an increase of 9.5 percent and up from 9.8 percent in the previous month. Imports stumbled an annual 9.6 percent to 9.090 trillion yen versus expectations for a decline of 8.4 percent following the 6.8 percent contraction a month earlier.

In the currency market, the U.S. dollar is trading in the lower 150 yen-range on Wednesday.

On the Wall Street, stocks moved mostly lower during trading on Tuesday, extending the pullback seen during last Friday’s session. The Nasdaq showed a notable move to the downside amid weakness among tech stocks.

The major averages ended the day in negative territory but off their lows of the session. The Nasdaq slumped 144.87 points or 0.9 percent to 15,630.78, the S&P 500 fell 30.06 points or 0.6 percent to 4,975.51 and the Dow dipped 64.19 points or 0.2 percent to 38,563.80.

Meanwhile, the major European markets finished the day mixed. While the French CAC 40 Index rose by 0.3 percent, the U.K.’s FTSE 100 Index and the German DAX Index both edged down by 0.1 percent.

Crude oil prices moved sharply lower on Tuesday, reflecting ongoing concerns about the outlook for demand. West Texas Intermediate for March delivery slumped $1.01 to $78.18 a barrel, while the more actively traded crude for April delivery tumbled $1.42 to $77.04 a barrel.

Market Analysis