July 13, 2017 / 6:59 AM / in a year

Nikkei ends flat; tech gains offset weakness in financials

* Nikkei finds support at 25-day moving average

* Banking stocks fall on lower U.S. yields after Yellen comments

By Ayai Tomisawa

TOKYO, July 13 (Reuters) - Japanese stocks ended flat on Thursday, as gains in tech shares offset weakness in financial stocks after U.S. yields slipped on Federal Reserve Chair Janet Yellen’s comments.

The Nikkei closed 0.01 percent higher at 20,099.81, while the broader Topix ended down 0.01 percent to 1,619.11.

The Nikkei benchmark index managed to find support at its 25-day moving average of 20,059.58, but held to a tight range all through the session as the dollar weakened against the yen after Yellen’s congressional testimony was seen as less hawkish than some traders had anticipated.

“After all, Yellen’s comment capped gains in the Japanese market as value stocks such as banks and autos weakened,” said Takuya Takahashi, a strategist at Daiwa Securities.

The dollar was 0.1 percent lower at 113.02 yen after losing about 0.7 percent overnight, when it was pulled back from a four-month high near 114.495 scaled earlier in the week on expectations of U.S.-Japan monetary policy divergence.

Yellen said the U.S. economy is healthy enough for the Fed to raise rates and begin winding down its massive bond portfolio, though low inflation may leave the central bank with diminished leeway.

Technology shares attracted buying as their U.S. counterparts rallied, with Tokyo Electron Ltd ending 3 percent higher and Murata Manufacturing Co Ltd closing 1.1 percent higher.

Banks lost ground after U.S. yields fell, with Mitsubishi UFJ Financial Group ending 1.5 percent lower, Mizuho Financial Group declined 1.3 percent, while insurer Dai-ichi Life Holdings dropped 2.1 percent.

The auto sector underperformed, closing 0.2 percent lower. Toyota Motor Corp shed 0.2 percent and Honda Motor Co dropped 0.4 percent. (Reporting by Ayai Tomisawa; Editing by Sherry Jacob-Phillips)

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