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Nikkei drops as market on edge with earnings in play, Fed outcome eyed
July 31, 2013 / 2:37 AM / 4 years ago

Nikkei drops as market on edge with earnings in play, Fed outcome eyed

* Nikkei falls 1 pct, Topix down 0.6 pct
    * Investors nervous before key events- trader
    * Market looks to Fed statement, more earnings for direction

    By Tomo Uetake
    TOKYO, July 31 (Reuters) - Japan's Nikkei share average fell
on Wednesday morning, as most investors adopted a wait-and-see
stance ahead of another batch of key domestic earnings and the
outcome of a Federal Reserve policy meeting for clarity on U.S.
economic stimulus.
    The benchmark Nikkei declined 1 percent to 13,736.76
in midmorning trade, erasing much of its 1.5 percent advance on
Tuesday, but was still on course for a first monthly gain in
three months. The broader Topix fell 0.8 percent to
    "Major global macro events due this week, including the
FOMC, are a source of nervousness and anticipation," said Stefan
Worrall, director of equity cash sales at Credit Suisse in
Tokyo, attributing the decline to the lack of buyers. "This
weakness today is reflective of the inability of yesterday's
rally to generate self-sustaining momentum."
    Worrall added that corporate earnings results that came out
this week were also not "consistently" positive to encourage 
    Fujitsu Ltd fell 3.1 percent after the industrial
electronics maker reported a net loss of 21.9 billion yen for
the April-June period. 
    Some exporters also succumbed to selling pressure, with
Toyota Motor Corp down 0.9 percent and Nikon Corp
 off 1.4 percent, as the Japanese currency hovered
around 98.02 yen to the dollar, still not far to a
one-month high of 97.64 hit on Monday. 
    A stronger yen is seen as a negative as it makes
export-reliant Japan's products less competitive in the global
    A few bright spots on earnings helped to contain the broad
market losses.
    Index heavyweight SoftBank Corp gained 4.1 percent
and was the most traded stock by turnover on the main board
after the iPhone carrier raised its full-year earnings outlook
for the year through March. 
    Rival KDDI Corp jumped 7.3 percent after Japan's
No.2 mobile carrier reported a record first-quarter profit that
exceeded market expectations. 
    Hitachi Ltd added 5.5 percent after the electronics
conglomerate surprised the market by lifting its profit outlook
for the first half ending September. 
    On Wednesday, companies including Honda Motor Co,
Fuji Heavy Industries Ltd, Panasonic Corp,
Toshiba Corp and Japan Airlines Co Ltd are set
to report first-quarter results after the market close.
    Later in the day, attention will shift to the Fed policy
statement, with investors hoping for clarity on when the U.S.
central bank will begin scaling back the massive bond-buying
programme that has bolstered global financial markets in recent

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