July 25, 2017 / 6:35 AM / a year ago

Nikkei edges down before Fed; Topix ends below key technical level

TOKYO, July 25 (Reuters) - Japan’s Nikkei share average edged down on Tuesday in choppy trade as investors braced for the outcome of the U.S. Federal Reserve’s policy meeting which begins later in the day.

The Nikkei ended 0.1 percent lower at 19,955.20 after trading in positive territory.

Traders were also concerned that the long-term rising trend in the broader Topix may run out of steam. It dropped 0.3 percent to 1,617.07, falling below its 25-day moving average on a closing basis for the first time in three months.

“The equity market is on hold at the moment, waiting for the Federal Open Market Committee (FOMC) outcome. The key is which direction currencies take in response to the Fed,” said Mitsushige Akino, chief fund manager at Ichiyoshi Asset Management.

“There won’t be a post-meeting press conference this time and a concern is the Fed coming through as too subdued. That could trigger a yen surge and in turn push down the Nikkei towards 19,500.”

Japanese Prime Minister Shinzo Abe’s flagging support ratings also continued to cap equities, although this was a factor that will likely take months to play out, Akino added.

Tech shares rose in tandem with their U.S. counterparts.

Tokyo Electron rose 1.1 percent and Advantest Corp soared 2.4 percent.

Drugmaker Mitsubishi Tanabe Pharma Corp was up 1.4 percent following news that it has agreed to purchase Israel’s Neuroderm for $1.1 billion as part of a strategy to expand its U.S. business.

Fellow drugmaker Shionogi & Co Ltd climbed 1.7 percent after the company announced that it would submit a new influenza drug application to regulators later in the financial year following positive results in trials.

Mobile carrier NTT Docomo lost 1.5 percent after the Nikkei business daily reported that its April-June group operating profit likely sank nearly 10 percent on year because of competition from budget carriers. (Reporting by Ayai Tomisawa and Shinichi Saoshiro; Editing by Shri Navaratnam)

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