Tokyo shares under pressure as Fed voices caution

Publish: 6:00 PM, August 1, 2019 | Update: 6:00:PM, August 1, 2019

TOKYO,– Tokyo shares opened lower Thursday, trailing falls on Wall Street after the Fed cut rates but expressed a cautious view about future actions.

The benchmark Nikkei 225 index lost 0.82 percent or 176.08 points to 21,345.45 in early trade while the broader Topix index fell 0.58 percent or
9.15 points to 1,555.99.

Tokyo players took cues from the New York market, where investors pushed down shares after hearing Fed Chairman Jerome Powell’s cautious position about future rate cuts.

While the US central bank cut its policy rate by 25 points as expected, Powell said it was not “the beginning of a long series of rate cuts. I didn’t
say it’s just one or anything like that.”

The opaque message diminished the market’s hope for future rate cuts, prompting selloffs on Wall Street, and the Dow ended down 1.2 percent.

“Following overnight falls on Wall Street, Tokyo shares are coming under pressure particularly the high-tech sector,” Okasan Online Securities said in
a note.

After a round of selling, however, Okasan expected investors would gradually return to buying, especially in companies with strong earnings.

“Investors will pick and choose individual shares, particularly those with strong earnings reports,” it added. SoftBank Group lost 0.44 percent to 5,603 yen, while Sony fell 1.46 percent to 6,080 yen. Panasonic plunged 3.26 percent to 894.6 yen.

Nissan lost 0.34 percent to 708.4 yen, while Toyota rose 0.93 percent to 7,089 yen. The dollar stood at 109.15 yen, rising from 108.77 yen in New York.