Nikkei opens lower on profit-taking

Employees work at the Tokyo Stock Exchange (TSE), operated by Japan Exchange Group Inc (JPX), in Tokyo. (Bloomberg pic)

TOKYO: Tokyo stocks opened lower on Friday after two days of rallies as investors locked in profits while awaiting fresh global data for clues on growth in major economies.

The benchmark Nikkei 225 index was down 0.65%, or 141.81 points, at 21,674.38 in early trade, while the broader Topix index was down 0.40%, or 6.53 points, at 1,610.12.

“Japanese shares are receiving some support from the eventless… (European Central Bank) meeting, but trade lacks a sense of direction following mixed US stocks indexes and ahead of fresh economic indicators” in China and the United States later Friday, Okasan Online Securities said in a commentary.

The dollar fetched ¥113.57 in early Asian trade, against ¥113.60 in New York late Thursday.

The ECB announced Thursday the end of its “quantitative easing” (QE) programme that has seen it pump €2.6 trillion (RM12.3 trillion) into the eurozone economy to stoke growth and inflation.

But even after net purchases of government and corporate bonds end, the bank said it will continue to stimulate the economy long into the future while announcing lower growth forecasts.

ECB chief Mario Draghi’s “fear of growing downside risks didn’t do too much damage to the euro”, National Australia Bank said in a note, adding traders were closely watching a set of data due later Friday in China and the United States, including US retail sales.

In Tokyo, Japan Display surged 40.30% to ¥74 after a report said it is in talks with Chinese firms over receiving some ¥50 billion (RM18 billion) in capital investment.

Chip-related shares were among losers, with Tokyo Electron dropping 4.10% to ¥13,530 and Advantest off 1.78% at ¥2,095.

Banks also slipped, with Mitsubishi UFJ down 1.04% at ¥585.2 and its rival Mizuho down 0.49% at ¥180.

Investors shrugged off the Bank of Japan’s quarterly Tankan business confidence survey, released 10 minutes before the opening bell, that showed no change in business confidence from the previous survey among major manufacturers.

In New York, the Dow ended up 0.3% at 24,597.38, while the S&P 500 closed flat and the Nasdaq fell 0.4%.