Tokyo shares ended lower yesterday, snapping a four day winning streak, as a plunge in the pound and caution ahead of a key US jobs report dampened buying sentiment.
Investors are waiting for the latest payroll figures later in the day for clues about the health of the world’s largest economy and chances of an interest rate hike this year.
The benchmark Nikkei 225 index slipped 0.23%, or 39.01 points, to close at 16,860.09.
It gained 2.49% over the week.
The broader Topix index of all first-section issues fell 0.25% or 3.32 points to 1,350.61. It rose 2.10% over the week.
In forex markets, the pound fell off a cliff to hit a 31-year low of $1.1841 before immediately rebounding to around $1.2450 — as calls by French President Francoise Hollande for tough Brexit talks triggered a computer-generated sell-off.
But the market’s focus was firmly on the US jobs report, with an upbeat reading likely to boost the dollar against the yen, a plus for Japanese shares, particularly exporters.
The dollar was trading at ¥104.00 compared with ¥103.95 in New York on Thursday afternoon.
“It’s partly the jobs data-wait but also the fact that Hong Kong and Japan are going to be closed on Monday” for public holidays, Andrew Sullivan, managing director of sales trading at Haitong International Securities Group, told Bloomberg News.
“People are more cautious because they don’t want to be exposed to the market when there’s key data coming out and they can’t react to it,” he added.
In stocks trade, banks gave up some of their recent gains with Sumitomo Mitsui Financial Group dropping 0.97% to ¥3,478 and Mitsubishi UFJ Financial falling 0.11% to ¥526.6.
Energy stocks rose, with Japan Petroleum up 2.45% at ¥2,422 and Inpex adding 1.66% to ¥965.8.
Hong Kong stocks slipped yesterday, pulled down by consumer and energy shares as investors locked in gains ahead of a long weekend and US job data that could give clues on when the Federal Reserve hikes interest rates.
The benchmark Hang Seng Index declined 0.4% to 23,851.82 points, snapping a four-day streak of advances. The China Enterprises Index dropped 0.2% to 9,923.82 points.
For the week, Hang Seng Index finished up 2.4% and the Chinese companies index rose 3.6%, their biggest weekly gains in four weeks.
Analysts said they anticipated mainland support for Hong Kong shares after Chinese markets reopen on Monday following a week-long holiday.
Hong Kong’s market will be closed on Monday for a holiday.
Yesterday, shares of Mengniu Dairy and China Resources Power, which rallied recently, fell 1.6% and 0.9% respectively.
Financials stocks added to declines, with Bank of Communications falling 1% and Ping An down 0.2%.
News that three more Chinese cities are joining 14 others in setting curbs on home-buying to prevent a bubble weighed on property developers.
Shares of China Resources Land and China Overseas Land declined more than 1%.
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