SYDNEY, June 5 (Reuters) - Japanese stocks slipped as investors locked in some of the week’s gains on Friday, but a weaker yen and overall optimism about an economic rebound from a coronavirus-driven slump kept the major indexes on track for a weekly rise.
The benchmark Nikkei average dropped 0.35% to 22,616.77 by the midday break, off its more than three-month high touched on Thursday. But the index was still up 3.4% for the week.
This week’s global equity rally lost some steam overnight as traders took winnings from recent gains, backing away ahead of Friday’s U.S. nonfarm payrolls data, which is expected to show further deterioration in the U.S. jobs market.
The broader Topix eased 0.33% to 1,598.51 by the midday recess, also off its more than three-month high, but with more than half of the 33 sector sub-indexes on the Tokyo exchange trading higher. For the week, the Topix was up 2.2% so far.
Analysts said although some profit-taking was unavoidable after the recent rallies, the overall sentiment is still positive.
Reflecting continued confidence in the revival of the global economy, the safe-haven yen weakened further, with the dollar/yen hitting a fresh two-month high of 109.235 yen on early Friday and the euro/yen touching a 13-month high of 123.965 yen overnight.
As a weak yen boosts Japanese manufacturers’ profits made abroad when repatriated, shares of export-oriented automakers were in demand. Mazda Motor jumped 4.8%, while Nissan Motor and Honda Motor gained 2.3% and 2.5%, respectively.
Longer-term U.S. Treasury yields jumped overnight, providing a tailwind for Tokyo-listed financial stocks . Dai-ichi Life Holdings advanced 4.6% and Sumitomo Mitsui Financial Group (SMFG) climbed 1.8%. (Reporting by Tomo Uetake; Editing by Rashmi Aich)
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