TOKYO, Aug 30: Japan’s Nikkei share average edged down on Friday in choppy trade and was on track to end both the week and month lower, with losses on the day led by oil shares as investors pared back the risk of an imminent U.S.-led military strike on Syria.
The Nikkei was down 0.3 percent to 13,417.15 in mid-morning trade, after earlier being up 0.3 percent.
So far, the index has fallen 1.5 percent this week and is posed to post its the first weekly fall in three weeks. It is also down around 2 percent for the month and set to post a fourth successive monthly fall.
Oil-related shares Inpex Corp dropped 2.8 percent, while Japan Petroleum Exploration shed 2.3 percent, weighed down by falls in oil futures as a military strike on Syria appeared less likely.
Panasonic Corp rose 5.3 percent to a 3 1/2-week high after saying it would resume paying dividends for the first time in a year and a half.
Data on Friday showed core consumer prices rose an annual 0.7 percent in July, the biggest increase in nearly five years boding well for the central bank’s efforts to eradicate deflation and offering support to the market.
‘The country is not out of deflation yet, but the CPI needs to stay high to implement a consumer tax hike, so in that sense the result was positive to the market, so investors covered their short positions after the data,’ said a fund manager at a Japanese asset management firm.
Analysts said trading would likely stay choppy and thin on the last trading day of the month. Investors were expected to remain wary of more outflows from emerging markets on expectations the U.S. Federal Reserve could start winding back its stimulus as soon as next month.
‘If investors sell emerging countries’ currencies and buy safe-haven yen, it will hurt Japan’s exporters shares, so we may have to brace for that possibility. Concerns on Syria have not faded completely, either,’ said Masanaga Kono, senior strategist at Amundi Japan.
On Friday, exporters were mixed, with Sony Corp rising 0.7 percent, Nissan Motor Co and Toyota Motor Corp shedding 0.2 percent.
The dollar rose to 98.37 yen from Thursday’s low of 97.45.
Hiromichi Tamura, chief strategist at Nomura Securities, said that the Nikkei could head higher in September depending on two big decisions: how the government proceeds with a planned sales tax increase and whether Tokyo wins the right to host the 2020 Summer Olympics at a vote on Sept. 7.
(AGENCIES)
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