The Tokyo stock market started down on Friday 13 January, weighed down by the strong appreciation of the yen against the dollar after the further slowdown in inflation in the United States in December, a sign of a less aggressive US monetary policy this year. The flagship Nikkei index lost 0.64% to 26,279.73 points around 00:30 GMT, while the broader Topix index was close to breakeven (-0.02% to 1,907.84 points).
The US CPI price index fell 0.1% on a month in December, in line with expectations, and fell to 6.5% on a year from 7.1% in November. Investors are hopeful that this sixth straight month of slowing inflation can finally convince the US Federal Reserve (Fed) to slow the pace of its rate hikes, or even lower them in the second half of 2023.
However, Tokyo stocks were moody on Friday as the yen rose sharply against the dollar following the US CPI, a currency move that hurt Japanese export stocks.
On the side of values
Fast Retail Fall: the Fast Retailing magazine was heavily sanctioned (-6.41% to 74,720 yen) after the lower than expected results of the Japanese prêt-à-porter giant for its first quarter 2022/23 (last September-November), published on day before after the close of the stock market. Brand owner Uniqlo’s profits also weakened due to the impact of Beijing’s “zero Covid” strategy on economic activity in China. Fast Retailing, on the other hand, maintained its annual forecast, betting on a recovery in growth of Uniqlo in China in the coming months thanks to the recent lifting of health restrictions in the country and on continued strong growth in other foreign markets.
On the side of currencies and oil
The dollar fell below 130 yen on Thursday for the first time in ten days and continued to depreciate on Friday morning in Asia, worth 128.73 yen around 00:30 GMT versus 129.25 yen the day before at 21:00 GMT. The euro was also down against the Japanese currency, trading on the euro at 139.91 yen versus 140.28 yen on Thursday. And the European currency continued to advance against the greenback, trading at $1.0865 versus $1.0853 a day earlier at 21:00 GMT.
In the oil market, a barrel of US WTI was stable (-0.05% at $78.35) around 00:20 GMT.