Nikkei slips on weakness in chip-related stocks

  • Reuters
  • Stock Market News
Nikkei slips on weakness in chip-related stocks
Credit: © Reuters.

* JDI nosedives after it says to cut jobs, downsize mobile ops

* Tokyo Electron, Advantest tumble

* Banks weak on prospects for U.S. rate cut

* Eyes on geopolitical risk amid extradition protests in Hong Kong

By Ayai Tomisawa

TOKYO, June 13 (Reuters) - Japan's Nikkei fell on Thursday morning, with chip-related shares battered after their U.S. counterparts tumbled while concerns over U.S.-China trade frictions kept activity in check.

The Nikkei share average .N225 dropped 0.8% to 20,958.25 at the midday break.

Chip-related stocks lost ground, with Tokyo Electron 8035.T and Advantest Corp 6857.T down more than 4%, after the Philadelphia Semiconductor index .SOX dropped 2.3%, while Micron Technology Inc MU.O and Applied Materials Inc AMAT.O both slumped more than 5%.

"Japanese tech shares took a hit as global investors are likely unloading shares in the overall tech sector," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

Concerns over trade continued to weigh on sentiment, after U.S. President Donald Trump on Tuesday said he was holding up a deal with China and had no interest in moving ahead unless Beijing agrees to four or five major points. said trading volume would likely be thin as investors await more cues for trade at the G20 summit this month, while they are also on the sidelines before the June settlement of Japanese stock futures and options on Friday.

Investors were keeping a close eye on violent protests in Hong Kong over an extradition bill that would allow people to be sent to mainland China for trial.

"A geopolitical risk has emerged amid Hong Kong extradition protests," said Masayuki Doshida, a senior market analyst at Rakuten Securities.

"Investors might not have positioned themselves based on this yet, but depending on developments, it could be a reason to dent the market in the future."

Hong Kong authorities were shutting government offices in the city's financial district for the rest of the week after a day of violence over the bill. stocks, which benefit from higher rates, languished on growing views the Federal Reserve will cut interest rates. Mitsubishi UFJ Financial Group 8306.T fell 2% and Sumitomo Mitsui Financial Group 8316.T dropped 1.3%.

Japan Display Inc 6740.T nosedived 12% after the struggling smartphone screen maker said it would downsize its mobile business and cut 1,200 jobs. broader Topix .TOPX fell 1.2% to 1,536.10, with all of its 33 subsectors in the red. (Editing by Jacqueline Wong)

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