Nikkei set to slide on Syria concerns, rising yen
TOKYO, Aug 28 (Reuters) - Japan's Nikkei share average is braced for a sharp fall on Wednesday, extending its losses into a third day on geopolitical uncertainty over a possible U.S.-led military strike against the Syrian government. Market players said the Nikkei was likely to trade between 13,100 to 13,400 after falling 0.7 percent to 13,542.37 on Tuesday. The benchmark is expected to breach its immediate support line of 13,270.72, a 23.6 percent retracement of the slide from its May high to its low in June. Nikkei futures in Chicago closed at 13,200, down 2.5 from the close in Osaka of 13,540. Market participants said the market will likely see a broad sell-off, with exporters leading the declines on the back of a rising yen as the geopolitical uncertainty prompted investors to pile into the safe-have Japanese currency. "Investors are risk-off now. Trading volume may be low, so selling in futures could drag down the market in early trade," said Yutaka Miura, a senior technical analyst at Mizuho Securities. The dollar last traded down 1.5 percent against the yen at 97.04 yen, not far from a one-week low of 96.97 yen reached earlier. A strong yen hurts Japanese exporters' competitiveness overseas as well as their dollar earnings when repatriated. Adding to the sombre mood is the continued slide in emerging market currencies, Miura said. "Short-term investors may sell futures if emerging markets' performances are bad. We need to monitor the yen's level as well, and we need to be bracing for volatility amid thin volume," Miura added. On Tuesday, emerging market currencies such as the Turkish lira and the Indian rupee hit record lows as doubts over the Syrian situation added to pressure from investors' bracing for an end to the supply of cheap dollars from the U.S. Federal Reserve's monetary stimulus. Western powers told the Syrian opposition to expect a strike against President Bashar al-Assad's forces within days, according to sources who attended a meeting between envoys and the Syrian National Coalition in Istanbul. Washington said on Monday it believed the Syrian president was responsible for a chemical weapons attack on civilians last week. > Wall St posts worst day since June on Syria concerns > Yen, Swiss franc rise as Syria fears spur demand for safety > U.S. bond prices rise as Syria fears fuel safety bid > Gold rises 1 pct on safe-haven bids, Syria fears > Brent hits 6-month high as West weighs strike on Syria STOCKS TO WATCH --Nissan Motor Co Ltd Nissan said it will be ready to bring fully self-driving vehicles to market by 2020. --Sumitomo Metal Mining Co Ltd Sumitomo Metal, Japan's second-largest copper smelter, has not ruled out using its right to match China Molybdenum Co Ltd's bid to buy a majority stake in the Northparkes copper mine in Australia, its president said on Tuesday. --McDonald's Holdings Co (Japan) Ltd McDonald's Holdings replaced on Tuesday the president and CEO of its operating company after its first-half sales and profits dropped as higher prices put off customers.
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