Tokyo Stocks Open Lower Tracking US Losses

ADDS analyst comments, share prices, forex rate

Tokyo stocks opened lower on Friday, tracking Wall Street losses after hot US wholesale price inflation and hawkish comments from a Fed official reignited rate hike fears.

The benchmark Nikkei 225 index was down 0.57 percent, or 156.52 points, at 27,539.92 in early trade, while the broader Topix index lost 0.42 percent, or 8.41 points, to 1,992.68.

Overnight, US stocks retreated after data showed the producer price index rose 0.7 percent in January, a quicker pace than predicted by analysts.

The data pointed to strength in the world’s largest economy despite an aggressive campaign to cool demand, sparking concerns that the US Federal Reserve could press on with larger interest rate hikes to rein in inflation.

“Continued strength in (US) inflation data suggests the Fed’s work is still not finished, and risks of a longer cycle are rising,” Stephen Innes, managing partner of SPI Asset Management, said in a note.

On Thursday, Cleveland Fed President Loretta Mester said she believed the central bank had to raise rates further and hold them there for some time.

The dollar fetched 134.14 yen in Asian trade, against 133.96 yen in New York late Thursday.

SoftBank Group was down 1.39 percent at 5,811 yen, Toyota was off 0.68 percent at 1,900 yen, and chip-testing equipment manufacturer Advantest was down 0.78 percent at 10,150 yen.

But shipping firm Mitsui O.S.K. Lines was up 0.44 percent at 3,445 yen and Nippon Steel gained 0.72 percent at 3,010 yen.