Tokyo: Nikkei slips as investors turn cautious before Fed, BOJ meetings

[TOKYO] Japan's Nikkei share average sank on Thursday (Dec 9), snapping a 2-day winning streak, as investors turned cautious ahead of key central bank meetings next week.

The Nikkei 225 closed down 0.47 per cent at 28,725.47, extending losses after the lunch break.

The index had touched a nearly 2-week intraday high of 28,908.29 in the morning, but the 200-day moving average at 28,895.39 provided stiff resistance as investors took a breather following a more than 4 per cent rally from last Thursday's (Dec 2) close.

The US Federal Reserve headlines a string of central bank policy decisions next week, which also includes the Bank of Japan and European Central Bank.

"Investors seem to want to take time to judge the direction of financial markets with so many key central banks meetings next week, so they are adopting a wait-and-see approach," said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management.

The broader Topix also extended losses in the afternoon session, dropping 0.57 per cent. Precision machinery, textiles and metal products stocks led declines.

Automakers also took a hit, with Nissan off 2.25 per cent, and Honda down 1.11 per cent.

Airlines, meanwhile, outperformed on hopes that the Omicron coronavirus variant will not significantly disrupt economic reopenings. Japan Airlines jumped 0.91 per cent and ANA Holdings gained 0.31 per cent Pfizer and partner BioNTech said on Wednesday (Dec 8) their 3-shot course of the vaccine was able to neutralise the new variant in a laboratory test, and they could deliver an upgraded vaccine in March 2022 if needed.

Tech shares also rose, buoyed by overnight gains for their US peers, which led the rally on Wall Street.

SoftBank Group gained 1.06 per cent, the best performer on the Nikkei by index points.

Internet retailer Rakuten Group jumped 0.95 per cent, while Lasertec climbed 1.53 per cent.

Sauce-maker Kikkoman was the Nikkei's biggest percentage gainer, rallying 2.28 per cent.

REUTERS