Nikkei index declines, affected by lower technology stocks

Japan’s Nikkei index fell on Wednesday, affected by a decline in technology stocks that are heavy on the index, but significant gains for Toyota Motor and Mitsubishi shares thanks to strong expectations for profits and returns to shareholders limited losses.

The Nikkei closed down 0.11% at 36,119.92 points, recovering from a decline of 0.84% earlier in the session.

“Investors have been taking profits from better-performing companies and buying cheaper stocks, as we saw in chip-related stocks today, which are tracking losses in the US chip stock index,” said Naoki Fujiwara, a senior fund manager at Shinkin Asset Management.

All three major Wall Street indexes rose overnight Tuesday, but the tech-heavy Nasdaq rose just 0.07% as the Philadelphia Semiconductor Index fell 1.14%.

In Japan, air conditioner maker Daikin Industries shares fell 7.07%. Tokyo Electron shares, which specialize in chip manufacturing equipment, lost 0.52%, and Advantest shares, which manufacture chip testing equipment, fell 0.84%.

KDDI Communications shares fell 1.96 percent after announcing a tender worth 500 billion yen ($3.38 billion) to buy the Lassen convenience store chain in partnership with Mitsubishi Corp. Lassen shares jumped 15.22%.

The broader Topix index rose 0.42% to 2,549.95 points, supported by Toyota and Mitsubishi shares.

Mitsubishi shares jumped 9.74 percent to its highest level ever after the trading company announced that it would spend up to 500 billion yen to buy back about 10 percent of its shares.

Toyota Motor shares rose 3.99% after the automaker raised its operating profit forecast for the full year by about nine percent.

Of the more than 1,600 stocks on the main market of the Tokyo Stock Exchange, 52% of the stocks rose, 44% fell, and 2% remained stable.