(Bloomberg) -- Shares in Tokyo took a late afternoon dive on Friday as investors cut positions on the last day of the fiscal year, erasing gains for 2017 amid lingering uncertainty over U.S. politics.
The Topix index fell 1 percent, ending the first three months of the year down 0.4 percent, marking just the fifth quarterly loss since Prime Minister Shinzo Abe took office in December 2012. Stocks started the day on a positive note after U.S. gross domestic product grew at a faster pace than previously reported in the fourth quarter on higher consumer spending. Sentiment weakened toward the close, with a gauge of volatility on the Nikkei 225 Stock Average rising for a second day.
“The market continues to be devoid of a clear direction,” said Yoshihiro Okumura, general manager at Chibagin Asset Management Co. “It's up one day, down the other on overseas factors. Economic data and hopes over corporate earnings are a plus, but politics remains a minus factor, which will likely be the case for the new quarter.”
“It's the end of the fiscal year, and ahead of the weekend, making investors inclined to sell and close off their positions,” says Kiyoshi Ishigane, chief strategist at Mitsubishi UFJ Kokusai Asset Management Co. “The supply and demand for Japan's equity market isn't great either with foreigners being sellers for the month, leaving the market devoid of buyers.”
Foreign investors sold nearly 1 trillion yen of Japanese stocks in the four weeks through Mar. 24, according to data from the Tokyo Stock Exchange. They are poised for a second-straight month of selling after offloading about 257 billion yen of local shares in February. That compares with net foreign buying of 32.6 billion yen in January.
Summary
- Topix -1% to 1,512.60 at close
- Nikkei 225 -0.8% to 18,909.26
- Yen little changed at 111.9 per dollar
- Banks biggest drag on Topix: MUFG -1%, SMFG -1.6%
- Automakers also down: Toyota -1.1%, Honda -1.3%
- Morinaga Milk -15%, Morinaga & Co. -6.8% after cos. decide against merger
- Toshiba +5.8% amid short-covering, says Ichiyoshi
--With assistance from Yuko Takeo
To contact the reporters on this story: Min Jeong Lee in Tokyo at mlee754@bloomberg.net, Nao Sano in Tokyo at nsano3@bloomberg.net.
To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Kurt Schussler, Tom Redmond
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