Japanese shares rack up biggest fall in 6 months as tech shares slide

  • Reuters
  • Stock Market News
Japanese shares rack up biggest fall in 6 months as tech shares slide
Credit: © Reuters.

TOKYO, Jan 28 (Reuters) - Japanese shares suffered their biggest drop in six months on Thursday, tracking Wall Street, weighed by technology companies which have benefited from a recent rally in stocks.

The Nikkei share average .N225 fell 1.53% to 28,197.42, the biggest decline since July 31, while the broader Topix .TOPX slid 1.14% to 1,838.85.

Topix's electric appliances index has jumped 6.34% this year, while the Topix has gained 1.89%.

"Today's market is tracking the U.S. stock markets. The rise in the stock volatility index is also prompting investors to sell down," said Yoshihiro Takeshige, general manager at investment management department of Asahi Life Asset Management.

Federal Reserve left interest rates unchanged and kept its bond-buying program intact, as widely expected, noting that the economic recovery has slowed in recent months. along with a slump in shares of planemaker Boeing (NYSE: BA ) Co BA.N led U.S. stocks to post their biggest one-day percentage drop in three months on Wednesday. .N

Rising coronavirus cases and uneven distribution of vaccine rollouts increased investor anxiety, sending the CBOE Market Volatility index .VIX to its highest since Oct. 30 overnight.

Local chip-related shares fell, with Renesas Electronics 6723.T losing 5.85%, Advantest 6857.T falling 4.3% and Sumco 3436.T declining 4.47%.

Fanuc 6954.T fell 1.01% even after the factory automation machinery maker raised its operating profit forecast for a second time to 105.8 billion yen ($1.01 billion), a 19.8% increase from a year earlier.

Nikkei's heavy weights also declined, with SoftBank Group 9984.T sinking 3.6%, Tokyo Electron 8035.T dropping 4.62% and Fast Retailing 9983.T falling 0.24%.

Shares in transport and retailers, which have been sold heavily during the pandemic, advanced. ANA Holdings 9202.T , Japan Airlines 9201.T and East Japan Railway 9020.T rose between 2.71% and 4.65%.

Automakers Mitsubishi Motors 7211.T rose 6.75% and Isuzu Motors 7202.T gained 4.73%, while department store operators Takashimaya 8233.T and Isetan Mitsukoshi Holdings 3099.T gained 4.85% and 5.67%, respectively.

($1 = 104.3300 yen)

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