The Nikkei index reversed course to close lower on Friday due to caution ahead of the Bank of Japan’s monetary policy meeting, while the yen’s rise against the dollar prompted investors to sell stocks.
The Nikkei index fell 0.09% to 32,391.26 points at the close, reversing a 1% jump earlier in the session. The index remained stable during the week.
The broader Topix index also reversed its course, falling 0.17% to 2239.10 points, and losing 0.7% during the week.
The Bank of Japan will hold its monetary policy meeting on July 27-28. Speculation that the central bank will adjust its ultra-loose policy led to a 10-year Japanese government bond yield rising on Friday to its highest level in four and a half months.
Meanwhile, the yen rose, touching a two-month high of 137.245 per dollar earlier in the session, on track to record its best performance in a week against the dollar since January, while the dollar hovered around its lowest level against the Japanese currency in 15 months.
Fast Retailing, which owns the Uniqlo brand, reversed course and fell 2.09%, having the biggest impact on the Nikkei. The stock was initially expected to consolidate gains made on Thursday when the company reported record third-quarter earnings and raised its full-year outlook.
SoftBank Group shares lost 2%.
Gains in chip-related companies limited the decline in the Nikkei after Advantest, a maker of chip testing equipment, jumped 5.74%, and Tokyo Electron, a maker of chipmaking equipment, gained 1.76%.