Topix Ends Longest Rally in Two Years on U.S. Yen Warning, China

Topix Ends Longest Rally in Two Years on U.S. Yen Warning, China

Bloomberg, (15/4) -- Japanese stocks fell, with the Topix Index snapping its longest winning streak in two years, after the U.S. said it would urge Japan to refrain from policies to devalue the yen and Chinese economic data missed estimates. The Topix dropped 1.3 percent to close at 1,133.99 in Tokyo, ending an eight-day advance that was the longest such streak since February 2011. More than two stocks slid for each that gained today. The Nikkei 225 Stock Average lost 1.6 percent to 13,275.66, with volume 30 percent above the 30-day average. “Profit-taking is dominating the market as it seems like the yen won’t weaken beyond 100 per dollar soon,” said Koji Toda, chief fund manager at Resona Bank Ltd. in Tokyo, which oversees about 15 trillion yen ($153 billion). “China’s data are confirming the underlying concern about its economic outlook.” The 14-day relative strength index of the Topix has stayed for four days above the 70 threshold that some traders say signals shares have risen too much, too fast. As G-20 finance ministers and central bankers prepare to convene this week in Washington, the U.S. Treasury said it will press Japan to refrain from competitive devaluation of the yen and European governments are urging it not to become too reliant on fiscal and monetary stimulus. The yen has rebounded after weakening to 99.95 per dollar on April 11, the lowest since April 2009. It traded at 98.08 per dollar today and gained against 15 of its 16 major counterparts. China’s gross domestic product grew 7.7 percent in the three months ended March from a year earlier, the National Bureau of Statistics said in Beijing today. That compares with the 8 percent median forecast in a Bloomberg News survey of 41 analysts and 7.9 percent in the fourth quarter. Industrial production gained less than estimated in March, while retail-sales growth matched forecasts.