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Asia, News

Japan stocks fall from one-week high on concerns over corporate earnings

By Stanley White

TOKYO, Aug 5 (Reuters) – Japanese shares retreated from a one-week high on Wednesday as downbeat earnings reports underscored the economic blow from the COVID-19 pandemic and a firmer yen weighed on exporters.

The Nikkei index was down 0.63% at 22,431.23 by 0221 GMT, with the consumer discretionary and the telecommunications sectors leading the declines.

The broader Topix fell 0.64% to 1,545.32

The Nikkei has rallied 37% from this year’s low hit in March but has recently struggled to break above resistance around 23,000 as investors turn more cautious in the face of rising coronavirus cases at home and elsewhere.

Highlighting the impact of the pandemic, Mitsubishi UFJ Financial Group Inc (MUFG), Japan’s largest lender by assets, said on Tuesday its net profit more than halved.

Shares in MUFG fell 0.7% on Wednesday.

Sony Corp, another major company to report earnings on Tuesday, traded 1.5% lower as worries over its future earnings eclipsed better-than-expected results from the company.

More Japanese companies are set to report earnings in the coming days.

There were 56 advancers on the Nikkei index against 165 decliners.

The underperformers among the top 30 core Topix names were SoftBank Group Corp, down 3.78%, followed by East Japan Railway Co, losing 3.73%.

Among the Topix 30 stocks that gained the most were gamemaker Nintendo Co Ltd, up 2.73% ahead of its earnings on Thursday, followed by industrial conglomerate Hitachi Ltd.

The volume of shares traded on the Tokyo Stock Exchange’s main board was 0.26 billion, compared with the average of 1.2 billion in the past 30 days. (Reporting by Stanley White; Editing by Aditya Soni)

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