Japan's Nikkei dipped on Tuesday, tracking losses on Wall Street as optimism there will be a deal to end the U.S.-China trade dispute faded and Beijing trimmed its economic growth target.
Japan’s Nikkei dipped on Tuesday, tracking losses on Wall Street as optimism there will be a deal to end the U.S.-China trade dispute faded and Beijing trimmed its economic growth target.
The Nikkei share average lost 0.6 percent to 21,690.06 by the lunch break.
Japan’s benchmark index, which has risen 8.4 percent this year, had hit its highest intraday trading level since Dec. 13 on Monday.
The broader Topix was down 0.8 percent at 1,614.58, with all but one of its 33 subsectors trading in negative territory.
A lacklustre session in Asian shares, which dipped as China set a lower economic growth target and pledged measures to support its economy, reduced investors’ risk appetites.
Hopes for the United States and China, the world’s two largest economies, working out a trade truce have been a significant factor helping lift demand for riskier assets such as shares since late last year.
Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management, said U.S. stocks fell overnight even as a major driver was lacking.
With Japanese stocks having rallied to the upper-21,000 level, “there are worries that it would be easy for selling from taking profits to emerge,” he said.
Companies with large exposure to the Chinese market, whose shares rallied on Monday, lost some ground on profit-taking.
Factory automation equipment maker Yaskawa Electric , which jumped more than 5 percent the previous day, shed 2.3 percent.
Robot maker Fanuc, following a surge of 3.5 percent on Monday, lost 1.7 percent. Construction equipment maker Komatsu also declined 1.7 percent.
Shares of Pigeon Corp slumped 7.8 percent after the baby care products maker reported fourth-quarter results late on Monday. Analysts said investors were disappointed with its performance in China.
Heavy machinery maker IHI Corp lost 3.2 percent after the company admitted that Japan’s transport ministry had inspected it for faulty checks of aircraft engines.
Index heavyweights Fast Retailing and Mitsubishi UFJ Financial Group bucked Tuesday’s downward trend, rising 2.7 percent and 0.1 percent, respectively.