TOKYO, Oct 30 (Reuters) – Japan’s Nikkei share average fell more than 1% on Monday, tracking declines on the Dow, as caution ahead of central bank meetings in the United States and Japan hurt risk appetite.
The Nikkei lost 1.23% to 30,609.48 by the midday break, while the broader Topix was down 1.04% to 2,231.23.
“The Nikkei was dragged down by the losses in the Dow Jones over the weekend. And investors hesitated to buy stocks as they awaited policy decisions at central bank meetings in the U.S. and Japan,” said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.
“Also investors wanted to wait for the announcement of more corporate outlook, as some companies were heavily sold after disclosing disappointing outlook.”
On Friday, the Dow Jones Industrial Average lost 1.12% and the S&P 500 lost 0.48%, as investors digested a hectic week of mixed earnings, and economic data that seemed to support the “higher for longer” interest rate scenario.
The Bank of Japan started a two-day policy meeting on Monday under growing pressure to shift further away from its controversial bond yield control as the 10-year bond yield nears the bank’s policy cap of 1%.
The U.S. Federal Reserve will keep its key interest rate on hold on Nov. 1 and may wait longer than previously thought before cutting it, according to economists in a Reuters poll, as the central bank’s higher-for-longer message gains traction.
Among individual shares, Hino Motors tumbled 18.69% to its daily limit after the automaker flagged an annual net loss, changing the forecast from a profit.
Omron also fell to its daily limit, tanking 15.83% after the healthcare equipment maker cut its annual profit forecast.
(Reporting by Junko Fujita; Editing by Mrigank Dhaniwala)
