Stocks turned slightly lower Monday, with the market succumbing to profit-taking after its sharp gains late last week.
The Nikkei 225 lost 6.46 points, or 0.03 percent, to end at 20,170.82. On Friday, the key market gauge soared 317.25 points to finish above 20,000 for the first time since Dec. 1, 2015.
The Topix, which covers all first-section issues, closed 2.23 points, or 0.14 percent, lower at 1,609.97 after climbing 26.06 points Friday.
Both indexes fell for the first time in three trading days.
The TSE opened weaker as selling to lock into gains outpaced buying following its surge in the past two sessions.
In particular, export-oriented names such as automakers met with selling due to the dollar’s fallback below ¥111 on the heels of weaker than expected U.S. employment data for May, released by the Labor Department on Friday, brokers said.
The Nikkei popped into positive territory late in the morning, showing the market’s solid downside.
After fluctuating tightly around Friday’s closing level early in the afternoon, the key yardstick gained some steam to advance to as high as 20,224.54 on the back of purchases of heavily weighted component issues reflecting their brisk earnings.
But the index slipped into negative territory just before the close, falling prey to renewed profit-taking pressure, brokers said.
“It cannot be denied that investor sentiment was somewhat dampened by the U.S. jobs data,” said Chihiro Ota, general manager for investment research and investor services at SMBC Nikko Securities Inc.
Investors are still confident of an interest rate hike by the U.S. Federal Reserve this month, but there are uncertainties now about the timing of possible further rate increases, Ota added.
The U.S. data showed that nonfarm payrolls in the country, one of the most closely watched items in the survey, increased 138,000 in May from the previous month after seasonal adjustment, falling short of market estimates of around 185,000, although the jobless rate dropped 0.1 percentage point to 4.3 percent to match the lowest level since May 2001 when it also stood at the level.
Pointing to falls in brokerage stocks on the TSE on Monday, an official of a major securities firm said that “investors have little hope for further rises of the market” after the Nikkei reached the psychologically important 20,000 line on Friday.
Falling issues outnumbered rising ones 1,070 to 829 on the TSE’s first section, while 118 issues were unchanged.
Volume slumped to 1.648 billion shares from 2.315 billion Friday.
Automakers Toyota, Subaru, Honda and Mazda met with selling due to the higher yen.
Financial issues, such as mega-bank groups Mitsubishi UFJ, Sumitomo Mitsui and Mizuho, insurers Dai-ichi Life and Tokio Marine, and brokerage firms Nomura and Daiwa, lost ground.
Other major losers included Nippon Steel & Sumitomo Metal, oil developer Inpex, shipping firm Nippon Yusen and trading firm Mitsui.
By contrast, Nidec attracted buying on a media report that the company plans to increase its production capacity for industrial robot parts by sevenfold.
Semiconductor-related Tokyo Electron, mobile phone carrier SoftBank Group and cosmetics maker Shiseido were also on the plus side.