Tokyo shares closed slightly higher on March 17 but the gains were capped by a stronger yen after the Federal Reserve hinted at a slower pace of interest rate hikes this year. / AFP PHOTO /
TOKYO, Japan (AFP) — Tokyo stocks eased Friday morning with focus turning to a weekend G20 finance ministers’ meeting, but Toshiba rebounded on reports the government may help fund the embattled firm’s turnaround.
Automakers dragged the main indexes down with investors retreating to the sidelines ahead of a long holiday weekend in Japan.
Markets are also awaiting news from the G20 gathering in Germany that brings together finance ministers from the world’s most powerful economies, as worries grow over the isolationist slant of United States President Donald Trump’s “America First” policy.
A meeting in Washington between Trump and German Chancellor Angela Merkel, scheduled for later Friday, was also attracting global attention.
“The upside looks tough with uncertainty ahead of the G20 meeting,” Nobuhiko Kuramochi, head of investment information at Mizuho Securities, told Bloomberg News.
“The US may raise issues relating to the dollar, border taxes and global trade, which could push the yen higher,” he said.
Tokyo’s benchmark Nikkei 225 index fell 0.34 percent, or 66.87 points, to 19,523.27 by the break, while the Topix index of all first-section issues was down 0.47 percent, or 7.45 points, at 1,565.24.
On Wall Street the Dow and S&P 500 both retreated on disappointment with Trump’s controversial budget proposal, which was filled with big defence spending and cuts to education and environmental projects.
However, it lacked any detail on his pledge to slash taxes and ramp up infrastructure spending.
Tokyo investors are also cautious as Japanese Prime Minister Shinzo Abe grapples with a brewing controversy over his connections to a school that promotes an extreme right ideology. It is a rare whiff of scandal for the conservative leader who swept to power in late 2012.
Japanese financial markets are closed Monday for a public holiday.
“It’s hard for investors to actively trade ahead of the long weekend,” said Nobuyuki Suzuki, senior market analyst at SBI Securities.
Toyota fell 1.13 percent to 6,380 yen, while Nissan slipped 0.26 percent to 1,134.5 yen.
Toshiba jumped 5.01 percent to 192.8 yen on reports that the Japanese government is mulling using state money to support the loss-hit company’s plans to spin off its prized memory chip business. The government denied the reports.
The dollar bought 113.44 yen, up from 113.26 yen Thursday.