business

Stocks close 1.62% lower

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Tokyo stocks fell 1.62% Monday despite an upbeat Japanese business confidence survey, with the yen's rise and caution ahead of a key U.S. central bank meeting weighing on the market.

The benchmark Nikkei 225 index lost 250.20 points to 15,152.91, while the Topix index of all first-section shares slipped 1.29%, or 15.93 points, to 1,222.95.

Investors are eyeing a possible announcement from the Fed that it will start reeling in its $85 billion-a-month bond buying scheme, which has been credited for buoying global equity markets.

Fed policymakers meet on Tuesday and Wednesday.

"We'll be watching how Japanese authorities act if the U.S. shifts its monetary policy," said Yoshihiro Okumura, general manager of research at Chibagin Asset Management.

The Tokyo market was dragged down by profit taking as uncertainty over the Fed's next move prompts investors to scale back their exposure.

Many expect the Fed will start slowing bond buying early next year -- negative for stocks at least initially -- but some even see that happening as soon as this week after the meeting.

Just before Tokyo markets opened, the Bank of Japan released a survey showing business confidence had soared to a six-year high.

The quarterly Tankan report is a plus for Tokyo's bid to stoke the world's third-largest economy, which saw growth slow in the third-quarter, sparking speculation the Bank of Japan will launch new easing measures to boost growth.

A stronger yen also weighed on the Tokyo market, hitting exporter shares as the dollar slipped to 102.82 yen in afternoon trade from 103.23 yen in New York.

© (c) 2013 AFP

©2022 GPlusMedia Inc.

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Sad thing is Nikkei is highly affected by foreign investors' trades which shows that domestic investor demand not strong (or has flattened). No worries though. Once Abe forces the Japan Pension Fund to buy stocks and ask BOJ to print more money, they will rise again.

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