Japan Nikkei falls on lingering trade war fears, ex-dividend trade

Headline shares of the Japan share market were lower down on Wednesday, 27 June 2018, shrugging off positive lead from Wall Street overnight, as worries over a trade war continued to weigh on the market. Meanwhile, companies' going ex-dividend added to the market's broader weakness. Among TSE33 issues, 20 issues were in negative terrain while remaining 13 were landed in green. Shares Rubber Products, Marine Transportation, Air Transportation, Real Estate, Banks, and Iron & Steel issues were notable losers, while Pulp & Paper, Oil & Coal Products, Fishery, Agriculture & Forestry, and Information & Communication were notable gainers. At the close of trades, the 225-issue Nikkei average lost 70.23 points, or 0.31%, to 22,271.77. The Topix index of all first-section issues was up 0.38 points, or 0.02%, at 1,731.45.

Investors focused on the simmering trade tensions are awaiting more clarity from the White House on its plans. President Donald Trump signaled he may take a less confrontational path toward curbing Chinese investments, backing down from earlier reports that the U.S. would bar Chinese money in certain technologies.

Companies whose business years end in December will go ex-dividend on Wednesday, after which investors will no longer qualify for the latest dividend payout. Among Nikkei companies going ex-dividend on Wednesday were Japan Tobacco, Canon and Bridgestone, which fell in a range of 3-5%.

Energy stocks rose, underpinned by higher oil prices on reports the U.S. is pressing allies to halt imports of Iranian crude. Crude oil prices surged Tuesday after U.S. officials threatened sanctions on countries that continue to import oil from Iran. In response, WTI crude rose $2.45 or 3.6% to $70.53 a barrel on the New York Mercantile Exchange.

Shares in the sea transport and airline sectors underperformed on worries about rising fuel costs. Mitsui OSK Lines and Nippon Yusen declined in a range of 2-3%, while Japan Airlines dropped and ANA Holdings shed in a range of 1-2%.

Shares in Oracle Corp Japan jumped after the company's parent net profit rose 6.6 percent on year to 38.7 billion yen for the fiscal year ended in May.

CURRENCY NEWS: The U.S. dollar changed hands in the lower 110 yen zone on Wednesday, marginally higher than its levels in New York overnight. Around late afternoon, the dollar was quoted at 110.13-14 yen compared with 109.96-110.06 yen in New York and 109.63-64 yen on Tuesday in Tokyo.

OFFSHORE MARKET NEWS: US stock market closed higher on Tuesday, 26 June 2018, with bargain hunting contributing to the initial strength, although traders seemed reluctant to pick up stocks amid lingering trade war concerns. The Dow added 30.31 points or 0.12% to finish at 24,283.11, the Nasdaq gained 29.62 points or 0.22% to 7,561.63 and the S&P rose 5.99 points or 0.22% to 2,723.06.

The European markets ended mixed on on Tuesday, 26 June 2018. The DAX of Germany dropped 0.29% and the CAC of France fell 0.05%, while the FTSE 100 of the U.K. gained 0.61%.

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