Tokyo: Shares snap 3-day rally, tech stocks fall amid US rate fears
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[TOKYO] Japanese shares closed lower on Tuesday after a three-session rally, tracking a weaker finish on Wall Street and as big tech stocks sold off amid fears over higher US interest rates.
The Nikkei share average fell 0.94 per cent to close at 28,230.61, while the broader Topix fell 0.7 per cent to 1,982.68.
"Wall Street's lower finish has pushed Japanese shares down but I would say today's declines were rather a reaction to a strong rally in the past few sessions," said Hideyuki Suzuki, general manager at investment research for SBI Securities.
"Investors saw rising US interest rates as risk factors because when rates are high, growth shares are sold. That means Japanese technology stocks also decline."
US stocks closed lower on Monday as investors grew nervous ahead of the third-quarter earnings reporting season, while US Treasury yields hit multi-month highs at the end of last week in the wake of a weaker-than-anticipated September employment report. US bond markets were closed on Monday for a holiday.
In Japan, technology heavyweights dragged the Nikkei lower on Tuesday, with startup investor SoftBank Group falling 2.42 per cent, robot maker Fanuc losing 1.66 per cent and medical equipment maker Terumo slipping 1.39 per cent.
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Shares that rose recently on hopes of an economic reopening fell, with retailers and airlines losing 1.89 per cent and 2.06 per cent, respectively.
Yaskawa Electric, which was among the first to report results every earnings season, extended losses despite an upward revision to its profit outlook on Friday, losing 4.34 per cent.
Automakers rose as the yen weakened against the dollar, with Toyota Motor climbing 0.78 per cent and Honda Motor edging up 0.2 per cent.
Oil explorer Inpex gained 1.76 per cent amid a spike in oil prices.
Eneos Holdings advanced 1.41 per cent after Japan's biggest refiner made a US$1.8 billion acquisition of solar power plant operator Japan Renewable Energy to expand its low-carbon business.
REUTERS
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