Tokyo stocks opened lower Thursday extending US losses, with fears growing among investors that there will be no respite from Federal Reserve rate hikes aimed at tamping down inflation.
The benchmark Nikkei 225 index was down 1.04 percent, or 291.67 points, at 27,799.86 in early trade, while the broader Topix index slipped 0.80 percent, or 15.76 points, to 1,947.40, reports BSS.
Concern about further widening of US and Japanese rate policy saw the yen depreciate again against the greenback, hitting a fresh 24-year low. The dollar stood at 139.48 yen in morning trade, against 138.97 yen seen on Wednesday in New York.
“Investors are more and more inclined to avoid taking risks” following Federal Reserve chief Jerome Powell’s comments last week that warned there will be no respite from interest rate hikes, Okasan Online Securities said in a note.
Further fuelling concerns over the prolonged monetary tightening, Cleveland Fed President Loretta Mester said Wednesday that she sees the central bank raising interest rates above 4 percent by early next year.
Investors in Japan are also “likely to avoid aggressive trading” as they look ahead to jobs data, especially Friday’s all-important US government employment report, Okasan said.
Among major shares in Tokyo, SoftBank Group was down 0.89 percent to 5,512 yen, Sony Group slid 0.35 percent to 11,095 yen and Toyota plunged 2.06 percent to 2,058 yen. Uniqlo operator Fast Retailing also lost 1.34 percent to 80,850 yen.