The Nikkei 225 dropped for the four straight day even after the strong performance by Softbank. Japan stocks declined by about 0.75% on Tuesday even as its American peers like Dow Jones and Nasdaq 100 hover at their highest levels. It is about 5% below its highest level in more than 30 years.
The biggest mover of the Nikkei 225 index was Softbank, which is also its biggest constituent. The company announced that it will buy back its stock worth about $8.8 billion. The goal of the current buyback program is to boost a share price that has been battered lately.
This happened as the company made a loss of 185 billion yen. The losses were mostly because of the company’s investments in Chinese companies like Alibaba and DiDi. Its investment in Coupang has also been disappointing. The Softbank share price jumped by more than 10% on Tuesday.
Other top movers in the Nikkei 225 were Teisei, Kajima, Meiji, and Taiyo Yuden. Leading companies like Yamaha, Isuzu, Mitsubishi Motors, and Mitsui rose. On the other hand, the top laggards in the index were Kawasaki Heavy Industries, Fujikura, and Nikon.
The Nikkei index has struggled in the past four straight days. On the daily chart, we see that the index has found a strong resistance at around 29,545 yen, which was the highest level in June and October 20th. The index has moved close to the Ichimoku cloud while the Stochastic Oscillator has moved from the overbought level.
Therefore, for now, the Nikkei 225 index will likely keep falling as investors target the next key support level at 28,000. A move above the resistance at 29,545 will invalidate the bearish view.
This post was last modified on %s = human-readable time difference 10:30