The Federal Reserve voted to leave interest rates unchanged for the fourth straight meeting while indicating it was moving toward future cuts -- but probably not before May at the earliest. Fed Chairman Jerome Powell said the central bank was unlikely to lower interest rates in March.
At closing bell, the 225-issue Nikkei Stock Average index declined by 275.25 points, or 0.76%, to 36,011.46. The broader Topix index of all First Section issues on the Tokyo Stock Exchange dropped by 17.06 points, 0.67%, to 2,534.04.
Total 25 of 33 TOPIX sectors declined, with Insurance, Rubber Products, Machinery, Transportation Equipment, and Real Estate issues being notable losers.
ECONOMIC NEWS: Japan's Manufacturing PMI Stagnates at 48.0 in Jan 2024, Marking 8th Consecutive Month of Contraction- The au Jibun Bank Japan Manufacturing PMI at 48.0 for January 2024 reflects an ongoing decline in factory activity for the eighth consecutive month. Despite a softer fall in output, challenges persist with shrinking new work and export sales, declining employment, and prolonged contraction in buying activity. Vendor performance deteriorated notably, and input costs rose, while output charges saw the smallest increase since June 2021. Despite these headwinds, sentiment remains robust, buoyed by expectations of improved demand for semiconductors and the mass production of newly-launched products.
CURRENCY NEWS: Japanese yen was appreciated to around upper 146 yen line per US dollar on Thursday after the Fed hinted there would be no further interest rate hikes following its policy meeting Wednesday. The yield on the benchmark 10-year Japanese government bond fell 0.040 percentage point from Wednesday's close to 0.690 percent, as investors bought the debt after an auction by the Finance Ministry met solid demand.
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