The Japan share market lost ground on Friday, 21 June 2019, as investors opted to take profits following recent advances, with selling compounded by the yen's strength against the U.S. dollar, anxiety over Sino-US trade negotiations, and fresh worries about the Middle East, after Iran shot down a US military drone. At closing bell, the 225-issue Nikkei Stock Average declined 0.95%, or 204.22 points, to 21,258.64, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange dropped 0.9%, or 14 points, at 1,545.90.

Total 26 subsectors out of 33 subsectors of the Topix's index declined, with Pharmaceutical, Construction, Real Estate, Warehousing & Harbor Transportation Services, and Insurance issues being notable losers, while Mining, Oil & Coal Products, and Nonferrous Metals issues were notable gainers.

Investors' focus has now shifted to a meeting between US President Donald Trump and China's President Xi Jinping during a Group of 20 summit in Japan next week, with hopes that they can put negotiations back on track to de-escalate a trade war. Trump said that he would decide whether to carry out his threat to hit Beijing with tariffs on at least $300 billion in Chinese goods after the meeting.

Investors have pinned hopes on some sort of compromise emerging when U.S. President Donald Trump meets China's President Xi Jinping on the sidelines of the G20 summit in Japan on June 28-29.

Meanwhile, fears of a military confrontation in the Middle East Gulf were raised after Iran shot down a U.S. military drone. The New York Times reported that U.S. President Donald Trump had approved military strikes on Friday against Iran in retaliation, but pulled back from launching the attacks.

Shares of energy companies inclined after jump in crude oil prices. Inpex Corp and Japan Petroleum Exploration Co jumped 4.4% and 3.7%, respectively while Idemitsu Kosan soared 2.4%.

Financial shares lost ground after US yields fell on the likelihood of an interest rate cut as early as next month following the Fed's policy meeting earlier this week. Mitsubishi UFJ Financial Group dropped 0.7% and MS& AD Insurance dropped 1.2%.

CURRENCY NEWS: Japanese yen appreciated against greenback on Thursday, after the Federal Reserve signalled it was ready to lower interest rates to combat growing global and domestic risks. The Japanese yen, often seen as a safe-haven currency, traded at 107.29 against the dollar after seeing levels above 107.6 yesterday.