TOKYO, March 6 (Reuters) - Japan's Nikkei share average
fell for a second session on Wednesday, as traders locked in
profits following the index's recent surge to an all-time high,
while the overnight drop in the tech-heavy Nasdaq also weighed.
Stocks were under pressure from overnight technology-led
slump on Wall Street, and both precision machinery
and electric machinery were among the bottom three
performers from the Tokyo Stock Exchange's 33 industry groups.
The Nikkei slipped 0.2% to 40,017.31, with
chip-related shares of Renesas, Lasertec and Sumco - the three
biggest percentage decliners - losing more than 3% each.
By contrast, the broader Topix rose 0.14%, with a
sub-index of value shares gaining 0.45%, while growth
shares fell 0.17%.
Overnight, all of the big three U.S. equity indexes slumped
more than 1% each, with the tech-heavy Nasdaq falling
the most. The Philadelphia SE Semiconductor Index dropped
more than 2%.
The Nikkei was still up nearly 20% in 2024, powered majorly
by tech shares amid the global euphoria over artificial
intelligence (AI). A weakening yen, down about 6% this year, has
also made Japanese stocks more attractive to the foreign funds
that have mainly driven the rally.
"After realizing such a steep rally since the start of the
year, if seems like we've now entered a period of speed
adjustment," which is likely to last until the Bank of Japan and
Federal Reserve policy meetings the week after next, said Kazuo
Kamitani, an equity strategist at Nomura Securities.
"Until then, the market will be sounding out a floor," and
as long as the Nikkei doesn't fall far below 39,000, "it'll be
an indication of an extremely strong market," he said.
Among other notable decliners on Wednesday, AI-focused
startup investor SoftBank Group dropped 1.42%, and
Uniqlo store operator Fast Retailing ( FRCOF ) lost more than 1%
to be the Nikkei's biggest drags in terms of index points.