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Nikkei slips on Wall Street retreat, record virus cases in Tokyo

07/28/2021 | 02:21am EDT

TOKYO, July 28 (Reuters) - The Nikkei fell to a near six-month low on Wednesday, as a retreat in Wall Street and concerns about rising coronavirus cases soured sentiment ahead of the U.S. Federal Reserve's policy meeting.

Shin-Etsu Chemical dipped despite fairly upbeat earnings, while Apple suppliers slipped following the U.S. tech giant's results, signalling some growth stocks could face hurdles as the earnings season comes into a full swing.

Nikkei share average fell 1.39% to 27,581.66, edging near a 6-1/2-month low of 27,330 touched last week. The broader Topix declined 0.95% to 1,919.65, led by 1.28% fall in growth stocks.

The fall came after U.S. peers dipped ahead of the Fed's policy meeting later in the day and as COVID-19 cases in Tokyo jumped to a record high of 2,848.

Shin-Etsu dropped 1.3% after the silicon wafer manufacturer's forecast of a record profit for the current year came almost in line with market expectations.

"Shin-Etsu Chemical's earnings were pretty good but today's market reaction shows the market won't react favourably unless there is a positive surprise," said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

"While global economic recovery supports the market on the whole, there are risk factors such as rise in coronavirus cases due to Delta variant, concerns about China's crackdown on tech firms. We could see the Nikkei testing 27,000."

Suppliers of Apple saw lacklustre trade as the company forecast revenue growth would slow.

Ibiden dropped 2.5%, while Murata Manufacturing lost 0.6%.

Makuake fell 15.9%, its daily limit, after the crowdfunding firm slashed its profit outlook for the current year.

Bicycle maker Shimano jumped 4.2% after it raised its profit forecast above analysts' average estimate.

Nisshin Seifun Group rose 4.2% after the flour milling and food company raised its annual earnings forecast following bumper profits in the April-June quarter.

Mitsubishi Motors jumped 8.4% after the embattled automaker revised up its earnings outlook.

SoftBank Group dropped 4.8% to an eight-month low on worries about China's crackdown on tech firms. (Reporting by Hideyuki Sano; editing by Vinay Dwivedi)

ę Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
APPLE INC. 0.34% 143.43 Delayed Quote.7.72%
IBIDEN CO.,LTD. -0.89% 6670 End-of-day quote.38.53%
MAKUAKE, INC. -2.72% 5000 End-of-day quote.-39.39%
MITSUBISHI MOTORS CORPORATION -2.79% 279 End-of-day quote.28.57%
MURATA MANUFACTURING CO., LTD. -1.57% 10015 End-of-day quote.7.46%
NISSHIN SEIFUN GROUP INC. -0.82% 1926 End-of-day quote.17.37%
SHIN-ETSU CHEMICAL CO., LTD. -0.82% 21150 End-of-day quote.17.24%
SOFTBANK GROUP CORP. -4.98% 6329 End-of-day quote.-21.46%
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