Tech stocks drag Japan's Nikkei to 13-month low ahead of Fed decision

Japan's Nikkei index fell to a fresh 13-month low on Wednesday, dragged down by technology heavyweights after their U.S. peers closed lower overnight on concerns over an increasingly hawkish Federal Reserve and tension over Ukraine.

The Nikkei share average was down 0.4% to 27,027.51 by 0211 GMT, after falling as much as 1% to its lowest since December 2020. The broader Topix edged down 0.1% to 1,894.60.
 

U.S. stocks whipsawed between steep losses and modest gains before ending well off session lows, with rate-sensitive tech stocks weighing most heavily.

The Fed is due to update its policy plan, likely fleshing out timing on expected rate hikes and shrinking its massive balance sheet.

"Investors are just waiting for the end of the Fed's meeting and how the market will move after that will totally depend on the outcome," said Takatoshi Itoshima, a strategist at Pictet Asset Management.

"Looking at the sell-off today, the market is expecting a hawkish move and the point is how hawkish the Fed will be." Technology heavyweights fell, with chip making equipment maker Tokyo Electron losing 1.35%, robot maker Fanuc falling 3.58% and motor maker Nidec slipping 3.75%.

Toyota Motor fell 1.05%, giving up gains fuelled by the auto maker's plans to produce a record 11 million cars in fiscal 2022.

Bucking the trend, game maker Nintendo jumped 3.91% after Nomura Securities rated its shares "buy." SoftBank Group gained 3.06% after a report said Nvidia was preparing to abandon its purchase of Arm Ltd from the Japanese technology investor.