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Japanese stocks flat on concerns over Covid Delta variant

Japanese stocks

The Nikkei average was flat at 28,815.10, and the broader Topix inched up 0.03% at 1,949.97

Japanese stocks traded flat after erasing early gains on Wednesday, as investors remained concerned about the Delta variant of Covid-19 in Asia and amid a nine-month-old trend of a weak finish on the last trading of the month.

At midday, the Nikkei average was flat at 28,815.10, after erasing early gains of 0.65%. The broader Topix inched up 0.03% at 1,949.97.

Shares initially followed an overnight rally in Wall Street, but investor-buying quickly succumbed to anxiety about the Japanese markets’ peculiar pattern since September to fall on the last trade of the month.

Some market players think it could be due to month-end rebalancing by big investors, while others think it is just a coincidence.

It’s just an anomaly. But then again, a lot of people are talking about it, so it does have some effect on the psychology, Masato Kogure, group leader of trade execution at Tokai Tokyo Securities said.

The market flitted within a range, underperforming global shares as investors weigh the progress in vaccination rollout against a surge in domestic infections ahead of the Olympics next month.

Among big movers, Sugi Holding 7.8% after the drugstore chain operator’s quarterly earnings dropped short of market expectations.

Nitto Boseki dropped 6.1% after one of its shareholders announced a plan to sell nearly 1 million shares, or about 2% of the outstanding, of the textile company.

Shares of J. Front Retailing declined 3.8% after the department store operator cut its profit outlook.

Chugai Pharmaceutical gained 7.9% after it applied for regulatory approval in Japan of an antibody treatment for COVID-19.

Murata Manufacturing added 3.1% after the company said it sees merit in lowering the minimum volume investors are able to trade in its shares while Ushio Inc jumped 12.7% after the lamp maker lifted its earnings outlook, doubling its net profit forecast for the current year through March.

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