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Nikkei seen under pressure after yen strengthens
July 16, 2012 / 11:39 PM / 5 years ago

Nikkei seen under pressure after yen strengthens

TOKYO (Reuters) - Japan’s Nikkei share average is expected to come under pressure on Tuesday as the yen’s gains against the dollar during a market holiday the previous day raise concerns over exporters.

A visitor looks at his mobile phone in front of monitors displaying market indices at the Tokyo Stock Exchange in Tokyo July 13, 2012. REUTERS/Toru Hanai

A surprise decline in U.S. June retail sales provided the latest evidence of a slowing U.S. economy, boosting speculation of stimulus measures from the Federal Reserve and undermining the dollar.

That lifted the yen to a one-month high of 78.688 per dollar on Monday.

“Looking at the yen’s moves, I feel that the market will still be in a correction phase and could turn negative,” said Yutaka Miura, senior technical analyst at Mizuho Securities.

Market players said the Nikkei was likely to trade between 8,650 to 8,800 on Tuesday.

Nikkei futures in Chicago closed at 8,735 on Monday, up from Friday’s close in Osaka of 8,700. Japanese markets were closed on Monday for a national holiday.

On Friday, the Nikkei crept up 0.1 percent to 8,724.12, snapping a six-day losing streak after Chinese growth data matched expectations, slightly easing fears about the state of the global economy.

Still, many investors are cautious, expecting companies to downgrade their earnings guidance in coming weeks due to the slowdown in the world economy.

Japan’s corporate earnings reporting season will get into high gear from next week and market players are looking at U.S. earnings after some high-profile disappointments last week.

>US STOCKS-S&P 500 falls for seventh day in eight .N >Dollar pressured on rising speculation of US easing <FRX/> >Bond yields match record lows as data spurs bets on Fed <US/> >Gold edges up as dollar drops, all eyes on Bernanke <GOL/> >Oil higher on stimulus hopes, Iran tension <O/R>

STOCKS TO WATCH

    -- Aderans 8170.T

    Hair-salon operator Regis Corp (RGS.N) said on Monday it will sell Hair Club for Men and Women, its hair loss products unit, to Aderans Co Ltd 8170.T for $163.5 million in cash.

    -- Toyota (7201.T)

    A U.S. senator told federal safety regulators he was concerned that they didn’t go far enough in a probe that found Toyota Motor Corp’s (7201.T) electronics systems did not cause unintended acceleration incidents.

    -- Seiko Epson (6724.T), Canon (7751.T), Ricoh (7752.T)

    Shares of laser and ink jet printer makers could come under pressure after Lexmark International Inc LXK.N on Friday joined a host of technology companies that warned of falling sales in Europe.

    Reporting by Hideyuki Sano; Editing by Edmund Klamann

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