Japanese stocks closed lower on Wednesday, with the Nikkei 225 Stock Average dropping 33.23 points, or 0.05%, to 67,744.29, and the broader Topix index falling 13.89 points, or 0.34%, to 4,096.78. The decline was attributed to high crude oil prices and underwhelming earnings from Dutch semiconductor equipment maker ASML Holding, which overshadowed gains in major technology shares.
Investor sentiment was cautious as US West Texas Intermediate crude oil futures remained above $90 per barrel, influenced by ongoing geopolitical tensions in the Middle East and the Russia-Ukraine conflict. This pressure on energy supplies has been a significant factor weighing on equities.
Despite the overall decline, buying in major technology stocks provided some support to the market, following a recent downturn. The Nikkei index had previously experienced a significant loss of over 2,900 points across four consecutive trading sessions leading up to Tuesday.
Additionally, market participants were guarded ahead of the release of US consumer price index data for September, which could shape expectations regarding the Federal Reserve’s future monetary policy decisions.
In currency markets, the US dollar traded around 158.34 yen in Tokyo. Meanwhile, Japan’s benchmark 10-year government bond yield slightly decreased to 2.995%, following steady demand at a five-year government bond auction.
The stock market initially showed positive movement but reversed its gains when ASML’s quarterly earnings report failed to meet investor expectations. This added to existing concerns within the technology sector, contributing to the day’s overall market decline.