Tech stocks pull Nikkei lower; investors cautious before Fed, earnings

Japan's Nikkei share average fell on Monday, with tech shares tracking a plunge in their Wall Street peers, while investors were also cautious ahead of a U.S. Federal Reserve policy meeting and Japanese earnings season getting into full swing.

The Nikkei dropped 0.55% to 27,371.11 as of the midday break, with startup investor SoftBank Group being the biggest drag on the index, slipping 3.13%.

Online game company Nexon dropped 3.62%, while Sony Group retreated 2.35% and Nintendo lost 2.21%.
 

The broader Topix fell 0.54% to 1,916.76, with the growth share index tumbling 0.96%, compared with a 0.14% loss for the value index.

Wall Street suffered its worst weekly drop last week since the early days of the COVID-19 pandemic, with the tech-heavy Nasdaq plunging 2.72% on Friday.

However in a sign that the U.S. selloff may have been overdone, Nasdaq futures were pointing to a 0.86% rise at Monday's reopen. That provided support for Japanese stocks, preventing bigger losses, said a market participant at a domestic securities firm.

Despite the Nikkei's slide, the number of winners and losers was almost equally balanced, with 109 gainers versus 111 decliners and the remaining five flat.

Energy was the best performing sector amid a rise in crude prices. Oil company Inpex jumped 4.38%.

Shipping companies also rallied, with Kawasaki Kisen's 4.41% advance making it the Nikkei's top gainer.

Nikon was another noteable winner, adding 3.96%, after local media reported that earnings at rival Canon are expected to swell 20% this year. Canon shares advanced 1.84%.

The Nikkei's biggest percentage decliner was shipbuilder Mitsui E&S Holdings, which plunged 11.96% after the company forecast an even bigger loss for this fiscal year.