Japanese shares meander on Fed rate speculation
Japan's Nikkei share gauge edged higher on Tuesday, snapping a two-day skid, as anticipation of rate cuts from the Federal Reserve and positive sales reports by department stores buoyed sentiment.
The Nikkei 225 Index struggled for direction, losing as much as 0.25% at one point, but ended the day up 0.3% to 42,310.49. The broader Topix added 0.6%.
Trading was subdued after a market holiday in the United States for Labour Day diminished trading cues. Ahead of key U.S. jobs data on Friday, markets are showing an 89% chance the Fed will reduce rates by 25 basis points (bp) at its next meeting.
"Japanese equities are finding some modest support, partially because the market is pricing in a 25 bp Fed rate cut in September, which is broadly positive for risk assets," said Dilin Wu, a research strategist at Pepperstone. "However, elevated Japanese government bond yields and spillover pressure from U.S. tech stock sell-offs are keeping buyers cautious."
Takashimaya and a unit of J.Front Retailing posted preliminary same-store sales figures for August on Monday that showed the first year-on-year rise since February.
Takashimaya shares gained 3.3%, while J.Front advanced 4.3%. Isetan Mitsukoshi, which narrowed its monthly sales decline, surged 5.9%.
There were 166 advancers on the Nikkei index against 58 decliners.
Source: Reuters
