Japanese Market Modestly Lower

(RTTNews) - The Japanese stock market is trading modestly lower on Wednesday, reversing some of the gains in the previous two sessions, despite the broadly positive cues from Wall Street overnight. The Nikkei 225 is falling well below the 70,500 level, with weakness in exporters and technology stocks partially offset by gains in index heavyweights.

The benchmark Nikkei 225 Index is down 220.69 or 0.31 percent at 70,463.29, after hitting a low of 70,425.06 earlier. Japanese stocks ended significantly higher on Tuesday.

Market heavyweight SoftBank Group is gaining almost 1 percent and Uniqlo operator Fast Retailing is adding more than 1 percent. Among automakers, Honda is losing almost 1 percent, while Toyota is edging up 0.2 percent.

In the tech space, Advantest is losing almost 1 percent, Tokyo Electron is declining almost 2 percent and Screen Holdings is slipping more than 2 percent.

In the banking sector, Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are edging up 0.2 to 0.5 percent each, while Mizuho Financial is edging down 0.3 percent.

Among the major exporters, Mitsubishi Electric and Panasonic are losing almost 1 percent each, while Canon and Sony are edging down 0.1 to 0.3 percent each.

Among other major losers, Disco is tumbling more than 6 percent, Kokusai Electric is slipping more than 4 percent, Kioxia Holdings is declining almost 4 percent and Murata Manufacturing is losing more than 3 percent, while Rakuten and TDK are down almost 3 percent each.

Conversely, Suzuki Motor, Taisei and Taiyo Yuden are advancing more than 3 percent each.

In economic news, the Reuters Tankan index for Japanese manufacturers increased for the third consecutive month to +22 in October 2026 from +21 in the previous month, marking the highest reading since December 2021. Meanwhile, non-manufacturers' sentiment fell to +23 from +29, marking the lowest reading since November 2024. Looking three months ahead, manufacturers expect sentiment to improve to +23, while non-manufacturers expect sentiment to weaken to +21.

Average cash earnings in Japan increased by 3.8 percent on year in August 2026, slightly exceeding market expectations for a 3.7 percent gain and staying above 3 percent for a seventh month, the longest such run since 1992. While it slowed from a revised 4.3 percent rise in July, it also marked the 56th consecutive month of nominal wage growth.

Japan's official reserve assets fell by US$29.1 billion, or 2.4 percent, to US$1.178 trillion at the end of September 2026 from US$1.208 trillion a month earlier, extending the decline following August's record drop.

In the currency market, the U.S. dollar is trading in the lower 158 yen-range on Wednesday.

On Wall Street, stocks gave back some ground over the course of the trading day on Tuesday but continued to turn in a strong performance after showing a notable move the upside early in the session. The major averages extended a recent upward trend, with the Nasdaq and S&P 500 reaching new record closing highs.

The major averages ended the day firmly in positive territory but well off their highs of the session. The S&P 500 climbed 44.98 points or 0.6 percent to 7,818.93, the Nasdaq rose 122.48 points or 0.5 percent to 27,599.79 and the Dow increased 253.38 points or 0.5 percent to 51,521.28. The major European markets also moved to the upside on the day. While the German DAX Index advanced by 0.8 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both rose by 0.4 percent.

Crude oil prices came off of early lows but still ticked lower on Tuesday following reports that Middle East crude exports are recovering back up toward pre-war levels. West Texas Intermediate crude for November delivery dipped $0.18 or 0.2 percent at $89.25 a barrel.