Japan Stocks Fall After Oil Decline Deepens, Tech Shares Rise

  • Oil holds losses after extending drop into bear market
  • Tug-of-war between oil price impact, tech stocks gains: Nomura

A pedestrian is reflected in an electronic stock board at a securities firm in Tokyo

Photographer: Akio Kon/Bloomberg

Shares in Tokyo fell for a second day after crude oil deepened its decline, while technology-related stocks boosted the Topix index.

Oil held losses after extending its drop into a bear market amid speculation rising U.S. output will blunt OPEC-led efforts to trim a global glut. Insurers and foodmakers weighed the most on the Topix, while pharmaceuticals, banks and electronics makers provided support. The yen advanced 0.3 percent versus the dollar. Volatility on the Nikkei 225 Stock Average was near its lowest since 2005.

“With a lack of reasons to move, it’s difficult to see any major flow emerging,” said Juichi Wako, a senior strategist at Nomura Holdings Inc. in Tokyo. “I see a tug-of-war between a decline in the oil market and a persistent expectation toward demand in technology shares.”

“Oil prices have fallen below key levels and is a concern,” said Takuya Takahashi, a Tokyo-based senior strategist at Daiwa Securities Co. “We could see oil money increasing selling pressure on Japanese stocks going forward.”

Summary

  • Topix -0.1% at 1,610.38 at the close in Tokyo
  • Nikkei 225 -0.1% at 20,110.51
  • Yen +0.3% at 111.05 per dollar
  • Alps Electric +2.4%; raised to outperform from neutral plus at Mito Securities
  • Asahi Intecc +3.1%; new buy at Daiwa, PT 7,000 yen
  • Balnibarbi +5.3%; raised to buy from neutral at Ichiyoshi Research
  • Ryohin Keikaku -1.1%; downgraded to neutral from overweight at JPMorgan
  • Takata -55%; first regular trading day this week as investors anticipate a filing for bankruptcy
  • V Technology +7.1%; Mizuho raises PT on outlook for new orders
  • Shinko Electric +4.3%; SMBC Nikko boosts PT on electrostatic chuck demand

For more on Japan markets:
Nomura Said to Choose Frankfurt as European Base After Brexit
Dollar Doldrums to Drive Yen, Euro Gain as Fed Hawks Doubted
Japan Two-Year Swap Spread Set for Narrowest Level in 9 Months
Yen Gains as Oil Hurts U.S. Inflation Outlook While Kiwi Rises
Japan’s Small-Mid Caps Show No Signs of Overheating: SMBC Nikko

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