Headline indices of the Japan share market closed down on first trading session of the wee, Monday, 08 July 2019, as profit booking triggered on tracking fall in Wall Street last Friday after strong U.S. employment data released on Friday helped moderate expectations for interest-rate cuts by the Federal Reserve. Meanwhile selloff pressure mounted on disappointing Japan core machine orders and on geopolitical worries linked to Iran. Total 30 subsectors out of 33 subsectors of the Topix's index declined, with Fishery, Agriculture & Forestry, Pharmaceutical, Textiles & Apparels, Construction, and Air Transportation issues being notable losers. At closing bell, the 225-issue Nikkei Stock Average declined 1%, or 212.03 points, to 21,534.35, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange shed by 0.9%, or 14.18 points, at 1,578.40.
US stocks retreated from records and lost ground last Friday as better-than-expected US job data clouded investors' hopes for steep cuts in interest rates in the world's biggest economy. The U.S. jobs report showed the economy stateside added better than expected 224,000 jobs in June, following a dismal jobs print in May. The solid US payrolls report dampened Fed rate cut expectations and severely dented the argument for a 50bps rate cut by the end of the month.
Geopolitical concerns was also weighing on the market following news on Sunday that Iran had breached the nuclear deal's cap on its stockpile of low-enriched uranium.
ECONOMIC NEWS: Japan Core Machine Orders Down 7.8% On Month In May -- Japan core machine orders were down 7.8% on month in May, worth 842.9 billion yen, the Cabinet Office said on Monday, following the 5.2% increase in April. On a yearly basis, core machine orders fell 3.7% following the 2.5% gain in the previous month. For the second quarter of 2019, core machine orders are forecast to have risen 15.7% on quarter and 5.0% on year.
Japan Overall Bank Lending Up 2.3% In June -- Japan overall bank lending was up 2.3% on year in June, the Bank of Japan said on Monday - coming in at 536.641 trillion yen, down from 2.6% in May. Excluding trusts, bank lending rose an annual 2.4% to 467.387 trillion yen, down from 2.8% in the previous month. Lending from trusts rose 1.3% on year to 69.253 trillion yen, while lending from foreign banks soared an annual 15.5% to 2.943 trillion yen.
Japan Posts Current Account Surplus Of Y1,594.8 Billion In May-- Japan posted a current account surplus of 1,594.8 billion yen in May, the Ministry of Finance said on Monday - down 15.8% on year, following the 1,707.4 billion yen surplus in April. The trade balance reflected a deficit of 650.9 billion yen versus forecasts for a shortfall of 758.9 billion yen following the 98.2 billion yen deficit in the previous month. Exports were down 6.3% on year to 5,918.0 billion yen, while imports eased an annual 0.9% to 6,569.0 billion yen.
CURRENCY NEWS: Japanese yen, often seen as a safe-haven currency, was little changed against greenback on Monday. The Japanese yen, viewed as a safe-haven currency, traded at 108.44 per dollar in Asian trade, against 108.50 per dollar in New York on Friday.