The benchmark Nikkei average fell back Thursday to close below 20,000 on the Tokyo Stock Exchange after being pushed down by profit-taking.
The 225-issue average shed 87.57 points, or 0.44 percent, to end at 19,994.06, its first closing below the threshold since June 16. On Wednesday, the key market gauge rose 49.28 points.
The Topix index of all first-section issues closed down 3.10 points, or 0.19 percent, at 1,615.53, after gaining 8.93 points the previous day.
Getting off to a weak start amid a lack of major trade incentives, the market remained under selling pressure for the rest of the day.
Major issues that had been robust recently, such as automakers and semiconductor-linked names, met with selling to lock in profits, contributing to the overall market’s weakness, brokers said.
A pause in the yen’s weakening against the dollar also discouraged investors from purchasing shares, they said.
“There were no particular unfavorable events for stocks,” said Hideyuki Suzuki, head of the investment market research department at SBI Securities Co.
A wait-and-see mood probably spread before the U.S. government’s release of its closely watched June employment report on Friday and other key events coming up next week, he added.
Chihiro Ota, general manager for investment research and investor services at SMBC Nikko Securities Inc., offered a similar view. But he also suggested the possibility of the market failing to regain vigor even after those events and taking “a major break.”
Even so, there would be no change in the long-term estimate that the Nikkei average could rise toward 25,000 supported by rosy prospects for corporate earnings, Ota added.
Falling issues outnumbered rising ones 1,006 to 861 in the TSE’s first section, while 154 issues were unchanged.
Volume fell to 1.68 billion shares, from Wednesday’s 1.79 billion shares.
Automakers Toyota, Honda and Mitsubishi Motors were downbeat along with chip-making gear manufacturer Tokyo Electron.
Lower crude oil prices spurred selling of energy-related stocks, such as Cosmo Energy Holdings, JXTG Holdings, Showa Shell Sekiyu and Fuji Oil.
Machinery makers, trading houses and banks were also sluggish.
Other major losers included retailer Ryohin Keikaku, convenience store chain Lawson and tire producer Bridgestone.
Meanwhile, contractors Wakachiku, Kajima, Taisei and Shimizu were buoyant on expectations for reconstruction demand in the rain disaster-hit Kyushu region.
In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average tumbled 100 points to 19,970.