Nikkei down as market cautious before Powell's remarks; machinery stocks fall

  • Reuters
  • Stock Market News
Nikkei down as market cautious before Powell's remarks; machinery stocks fall
Credit: © Reuters.

* Machine tool orders for June tumble 38% on year

* Yoshinoya soars after it posts net profit for March-May

By Ayai Tomisawa

TOKYO, July 10 (Reuters) - Japan's Nikkei edged lower in choppy trade on Wednesday as investors awaited key testimony on the U.S. economy from the Federal Reserve chief, while machinery shares fell on poor June orders.

The Nikkei share average .N225 shed 0.1% to 21,548.43, after flirting with positive territory.

Investors braced for remarks from Fed Chairman Jerome Powell during his two-day testimony before Congress, which starts on Wednesday. Also due on Wednesday is the central bank's June policy meeting minutes.

"The market has priced in a 25 basis rate cut. Investors are nervous as they wait to find out from Powell's comments on whether the Fed will continue cutting rates or not," said Yutaka Miura, a senior technical analyst at Mizuho Securities.

Machinery shares languished, after Japan Machine Tool Builders' Association said on Tuesday that June orders for machine tools tumbled 38% to 98.8 billion yen ($907.25 million), falling for ninth consecutive months. Fanuc Corp 6954.T slipped 1.6% and Yaskawa Electric 6506.T dropped 1.4%, while Keyence Corp 6861.T shed 1%.

Elsewhere the regional banking sector was under the spotlight. Chiba Bank 8331.T rallied 2.2% after the bank and Bank Of Yokohama said they are considering a business tie-up. Financial Group 7186.T , Bank of Yokohama's parent company, gained 1%.

In positive earnings news, Yoshinoya Holdings 9861.T , which operates beef bowl fast food restaurants, jumped 9% after it posted a net profit of 1.097 billion yen the March-May period, compared to a net loss of 388 million yen in the previous year.

The broader Topix .TOPX fell 0.5% to 1,566.56.

($1 = 108.9000 yen) (Editing by Shri Navaratnam)

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