TOKYO, July 7 (Reuters) - Japanese stocks ended lower on Tuesday after domestic household spending dropped at the fastest pace on record in May due to the coronavirus lockdown, although heavyweight SoftBank Group’s sharp gains helped stem the benchmark’s losses.
The Nikkei average fell 0.44% to 22,614.69, snapping a three-session winning streak after marking its highest close since early June on Monday.
Japan’s household spending slumped 16.2% in May, data showed, with the pandemic driving large cuts in spending on hotels, transportation and eating out.
Nikkei’s losses on Tuesday came despite sharp overnight gains on Wall Street, with Nasdaq hitting a record high as data showed U.S. services industry activity rebounded sharply in June, while hopes for a revival in China’s economy also boosted sentiment.
“Some factors behind China’s recent rally were that China quickly contained the virus and headed towards economic recovery,” said Takashi Hiroki, chief strategist at Monex Securities in Tokyo.
“The focus is on whether Japan’s upcoming data will also show a stronger tendency toward recovery,” he said, adding that the Cabinet Office’s Economy Watchers Survey, due to be released on Wednesday, will be one of the indicators of where Japan is headed.
Bucking overall weakness, SoftBank climbed 4.6% after the company’s massive buybacks, reaching levels last seen during the dot-com bubble in early 2000.
The broader Topix fell 0.34% to 1,571.71.
Nearly two-thirds of the 33 sector sub-indexes on the Tokyo Stock Exchange traded in the red, with land transport and drugmakers leading the losses.
Department store operator Takashimaya Co Ltd slipped 2.64% after it reported a net loss of 20.53 billion yen in the March-May quarter, with sales nearly halving from the previous year.
Reporting by Eimi Yamamitsu, Editing by Sherry Jacob-Phillips and Devika Syamnath