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Roundup: Japan's Nikkei end slightly lower on renewed U.S. rate hike woes



TOKYO, Nov. 18 (Xinhua) — Japan’s benchmark Nikkei stock index closed slightly lower Friday on renewed concerns over future aggressive rate hikes by the U.S. Federal Reserve.

The 225-issue Nikkei Stock Average shed 30.80 points, or 0.11 percent, from Thursday to close the day at 27,899.77.

The broader Topix index, meanwhile, edged up 0.75 points, or 0.04 percent, higher to finish at 1,967.03.

Dealers here said that investor sentiment was dented by fresh fears the Fed not easing its interest rate hikes would negatively impact its own and the broader global economic environment.

James Bullard, president of the St. Louis Federal Reserve Bank saying further interest rate hikes are necessary, sent the U.S. S&P 500 lower overnight and pushed up the U.S. dollar versus the yen, local brokers said, adding the news led to a selloff.

“Hopes that the Fed will go for slower rate hikes in December onward receded following the remarks,” Masahiro Yamaguchi, head of investment research at SMBC Trust Bank, was quoted as saying with reference to Bullard’s remarks.

Following a fall in U.S. Treasury yields however during after-hours trading, the yen regained ground on the U.S. dollar.

But amid a lack of other trading cues, market strategists said that investors opted to take profits as the Nikkei neared the psychologically important 28,000 mark.

“Amid an absence of strong trading cues leading up to the next U.S. payrolls report at the start of December, the Nikkei is likely to continue to fluctuate in a range between 27,500 and 28,100,” Kazuo Kamitani, an equity strategist at Nomura Securities, was quoted as saying.

By the close of play, marine transportation, service, and air transportation issues comprised those that declined the most, while insurance, textile and apparel, and pharmaceutical issues led notable gainers.

Nikkei heavyweight SoftBank Group weighed the most on the market, dropping 3.9 percent, while online hiring firm Recruit Holdings and online retailer Rakuten Group lost 5.5 and 3.2 percent, respectively.

Air transportation issues were sold for profits ahead of the weekend, after gains made recently on hopes for increased patronage.

Among these, ANA Holdings dropped 0.6 percent, while Japan Airlines ended the day 0.9 percent lower.

Bucking the downward trend, automobile-oriented stocks advanced as the yen’s earlier weakness against the U.S. dollar gave issues with a large exposure to overseas markets a boost.

Exporters, which include carmakers, see profits grow when repatriated from overseas on favorable exchange rates. The yen’s weakness against its major peers can also see exporters revise upwards their profit guidance, investment analysts highlighted.

Carmakers gaining ground included Honda Motor advancing 1.0 percent, while Suzuki Motor accelerated 2.2 percent.

Issues that rose outpaced those that fell by 986 to 753, while 97 ended the day unchanged.

On the Prime Market on Friday, 1,126.25 million shares changed hands, rising from Thursday’s volume of 1,069.05 million shares.

The turnover on the final trading day of the week came to 2,986.47 billion yen (21.34 billion U.S. dollars).