NIKKEI 225 BELOW 22K AS US PLANS AUTO TARIFFS
Nikkei 225 futures are currently trading at 21700-lower by 0.75% as compared to the previous closing. In the cash markets, the Nikkei 225 fell 2.06% to close at 21,810.52 points on Tuesday. The Index hit its weakest level (21,484.65) since 30th October during the session. The Nikkei 225 tracked losses on Wall Street overnight with technology shares sliding after U.S. counterparts were hit by Apple Inc’s slide.
The broader Topix fell 2% to close at 1,638.45.
Apple fell 5% on Monday after several suppliers to the company, including Lumentum Holdings, cut their forecasts. In turn, Apple-linked stocks in Tokyo retreated. Japan Display plunged more than 9%, Murata Manufacturing Co. slid 4.7%, Minebea Mitsumi lost 3.1% and TDK Corp fell 6.3% on Tuesday.
Other technology stocks in the index also fell in the wake of the overnight U.S. retreat, with Tokyo Electron falling 1.8%, Screen Holdings shedding 5.5% and Advantest Corp losing 3.2%. Sony Corp plunged 2.6% on Tuesday.
Automakers sank following news that the U.S. Commerce Department submitted draft recommendations to the White House on its investigation into whether to impose tariffs of up to 25% on imported cars and parts on national security grounds. Toyota Motor Corp fell 2.4%, Nissan Motor lost about 2% and Honda Motor fell 2.1% on Tuesday.
On the other hand, index- member Toshiba Corp rose 4.1% on Tuesday after announcing that it would repurchase up to 192.6M shares, or 30% of its outstanding stock.
On the economic front, the GDP (QoQ) (Preliminary reading) for the third quarter is scheduled to be released at 6:50 pm ET on Tuesday. The GDP is expected to fall 0.3% QoQ with the GDP growth being 0.7% in the previous quarter.
On the technical front, the RSI is currently at 42% and suggests that the market can continue trading sideways. The current price is below the MA5. The current price is below the middle line of the Bollinger Bands and is heading downwards.
Overall Bias is Negative and Short-term trades can be initiated with tight Stop Loss and Take Profit targets.
Trade Suggestion-Limit Sell At 21800, Take Profit At 21550 Stop Loss At 21930