Tokyo stocks edge down in thin trading despite record Dow Jones close

Stocks ended modestly lower on the Tokyo Stock Exchange Wednesday in thin trading before the U.S. Federal Reserve’s announcement of the outcome of its policy-setting meeting later in the day.

The 225-issue Nikkei average fell 15.23 points, or 0.08 percent, to close at 19,883.52. On Tuesday, the key market gauge lost 9.83 points.

The Topix index of all first-section issues finished down 1.74 points, or 0.11 percent, at 1,591.77, after losing 1.96 points the previous day.

The Nikkei average retook 20,000 shortly after the opening bell on buying prompted by the Dow Jones industrial average’s record closing on the New York Stock Exchange on Tuesday.

But the Tokyo market’s topside soon grew heavy, with investors increasingly taking to the sidelines to wait for the Fed announcement of a decision at the two-day Federal Open Market Committee meeting through Wednesday, brokers said.

Stocks gradually shed gains and sank into negative territory toward the day’s closing.

“Investors were convinced that the Fed would carry out an interest rate hike,” said Hideyuki Suzuki, head of the investment market research department at SBI Securities Co.

“Despite the view, however, especially institutional investors were unable to step up purchases” as they were wary of what an FOMC statement or Fed Chairwoman Janet Yellen would actually say after the meeting, Suzuki added.

Meanwhile, the market’s downside was limited thanks to buying of incentive-backed issues.

Players hunted companies for which analysts upgraded earnings estimates, an official of a bank-affiliated securities firm said.

Falling issues outnumbered rising ones 1,082 to 774 in the TSE’s first section, while 162 issues were unchanged.

Volume slightly grew to 1.70 billion shares, from Tuesday’s 1.61 billion shares.

Mega-bank groups Mitsubishi UFJ, Sumitomo Mitsui and Mizuho gave up gains to end lower.

Oil companies JXTG Holdings and Idemitsu, Sumitomo Metal Mining and shipping firm Mitsui O.S.K. Lines met with selling.

Other major losers included mobile phone carriers SoftBank Group and KDDI, clothing store chain operator Fast Retailing, automaker Toyota and semiconductor-related Tokyo Electron.

By contrast, Ono Pharmaceutical attracted purchases after announcing a plan to buy back its own shares.

Game-maker Nintendo, industrial robot maker Fanuc and railway operator JR East were buoyant.

In index futures trading on the Osaka Exchange, the key September contract on the Nikkei average ended down 10 points at 19,880.

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