Japanese stocks fell as investors awaited Federal Reserve and Bank of Japan monetary policy reviews and the outcome of negotiations that may decide the future of Greece as a member of the euro zone.
Sanyo Special Steel Co. led declines among iron and steel makers. Hokuetsu Kishu Paper Co. slid 1.5 percent after a report cited its president as saying Daio Paper Corp. is in talks to merge with Mitsubishi Paper Mills Ltd. Kose Corp. jumped 4.9 percent as Credit Suisse Group AG boosted its share price outlook on the cosmetics maker. Bearings maker NTN Corp. jumped to its highest close in seven years after Nomura Holdings Inc. raised its rating on the stock.
The Topix index slipped 0.4 percent to 1,633.70 at the close of trading in Tokyo after rising as much as 0.4 percent. About five shares fell for every four that rose, with volume about 24 percent below the 30-day average. The Nikkei 225 Stock Average slid 0.2 percent to 20,219.27.
“There are just so many catalysts we’re waiting for,” said Akio Yoshino, chief economist in Tokyo at Amundi Japan Ltd., which oversees about 3.74 trillion yen ($30 billion). “We want to see what happens with the FOMC, Greece and Europe and whether they come to an agreement, and Japan’s growth strategy.”
The Fed concludes a two-day meeting Wednesday, with officials and Chair Janet Yellen expected to leave interest rates unchanged after the economy contracted in the first quarter amid harsh winter weather. Policy makers anticipate growth will rebound enough to potentially allow for a rate increase this year. The Bank of Japan also reviews borrowing costs this week.
Recent U.S. economic reports from retail sales to wage growth have been improving, though disappointing factory data Monday increased investor uncertainty as to whether the rebound is strong enough to withstand a rate increase.
E-mini futures on the Standard & Poor’s 500 Index gained 0.2 percent. The underlying gauge climbed 0.6 percent in New York on Tuesday, rising above its average price over the past 100 days.
“I expect there to be a sense of relief if Yellen says that they won’t hurry into rate hikes, or says something supportive toward a recovery in the U.S. economy,” Hiroichi Nishi, a manager at SMBC Nikko Securities Inc. in Tokyo, said by phone. “The market continues to be wary of Greece’s possible default.”
Investors continue to look for indications of progress in Greece’s debt talks after the Mediterranean nation signaled it won’t make further concessions to unlock bailout funds needed to avoid default.
Greek Prime Minister Alexis Tsipras accused the International Monetary Fund of “criminal” responsibility for the indebted nation’s situation, with euro-area finance ministers to meet Thursday for further discussions over a bailout deal. German Chancellor Angela Merkel struck a more conciliatory tone, saying she’ll “do everything possible to keep Greece in the euro zone.”
Japan’s trade deficit in May was 216 billion yen, less than the 258.8 billion yen gap forecast by economists, the government reported. Exports rose 2.4 percent from a year earlier and imports fell 8.7 percent.
The Topix Iron & Steel Index lost 1.4 percent to lead declines among the 33 industry groups on the broader gauge. Sanyo Special Steel fell 2.7 percent.
Hokuetsu Kishu Paper, which owns about 21 percent of Daio Paper, according to Bloomberg data, declined 1.5 percent. Daio Paper and Mitsubishi Paper Mills are negotiating a merger, Kyodo News reported, citing Hokuetsu Kishu President Sekio Kishimoto.
Kose gained 4.9 percent to 9,210 yen after Credit Suisse raised its target price on the stock to 10,200 yen from 8,200 yen.
NTN surged 7.2 percent, the most on the Nikkei 225 and its highest close since June 2008, after Nomura raised its rating on the stock to buy from neutral.