Nikkei Closes Lower Amid Profit-Taking

The Japanese “Nikkei” index closed lower on Thursday as investors rushed to sell stocks to take profits after the record high the index had reached.

However, it erased most of its early losses due to buying demand resulting from the dips.

The “Nikkei” fell for the second day and dropped 0.11 percent to close at 39166.19 points, after falling up to 0.8 percent earlier in the session to trade below the 39,000 mark for the first time since February 22.

Shuji Hosoi, Chief Strategist at Daiwa Securities, said investors bought stocks again after the “Nikkei” fell below 39,000 points.

He continued: “One prominent stock was Toyota, which rose despite the strength of the yen. It showed that investors are still seeking large Japanese companies.”

The yen rose against the dollar on Thursday after Bank of Japan board member Hajime Takata said the bank should consider changing its extremely loose monetary policy.

Toyota’s stock reversed its early losses to close up 1.43 percent and became the biggest supporter of the broader TOPIX index, which closed up 0.03 percent at 2675.73 points.

Tokyo Electron’s stock also reversed its early losses to close up 1.04 percent.

Ryo Taro Sawada, Chief Market Analyst at the Tokyo Institute of Tokai Research, said morale was affected by the latest Ministry of Finance data showing that foreign investors turned to net sellers of Japanese stocks in the week ended February 24. Foreign investors sold 200 billion yen ($1.33 billion) worth of Japanese stocks in the week, putting an end to a seven-week buying spree.

reuters