Tokyo: Japan's Nikkei stock average fell on Friday, slipping back below the 9,000 level as profit-taking emerged after six straight days of gains and following a drop in US shares ahead of a key jobs report. The Nikkei slid 8.9 per cent in August and while most market participants expect September to be a better month, uncertainty about the strength of the global economy continues to cap the upside.
A decline in the employment component of the Institute for Supply Management's factory activity index on Thursday has heightened worries that US nonfarm payroll data due later on Friday will be worse than some had initially believed.
The report is scheduled to be released at 1230 GMT, and economists polled by Reuters expected US non-farm payrolls to rise by 75,000 in August and unemployment to stay at 9.1 per cent.
"Global economic worries are the main focus and volume has been relatively low recently. At times like this, both buying and selling can be risky, so this is keeping stocks trapped in their recent ranges," said Yutaka Miura, senior technical analyst at Mizuho Securities.
The jobs report is the only major employment indicator before the Fed's specially lengthened two-day policy meeting from September 20, at which many market participants are expecting the Fed to decide on additional easing steps. Unemployment is a key determinant in whether the Fed takes additional action to support the economy.
The Nikkei, which closed above 9,000 for the first time in two weeks on Thursday, was down 1.1 per cent at 8,960.59, giving back most of the previous day's gains.
The broader Topix index also fell 1.1 per cent, to 770.02.
Volume was thin, with 678 million shares changing hands so far on the Tokyo exchange's main board, on track to fall short of last week's average daily volume of 2.04 billion shares.
Major US stock indexes fell 1 per cent on Thursday on wariness ahead of the nonfarm payrolls report.
Japanese markets showed a muted reaction to media reports on Friday that Jun Azumi, a relatively unknown former parliamentary affairs chief for the ruling Democratic Party, will become Japan's new finance minister.
"Since the former finance minister has become the prime minister, the situation will remain stable and secure and the same basic policies will continue," said Kenichi Hirano, operating officer at Tachibana Securities, before Azumi's appointment was reported.
Sony Corp lost 4.3 per cent to 1,625 yen. The Nikkei business daily reported Friday that the yen's strength against the euro is pushing down operating profits of electronics manufacturers, including Sony.
Toyota Motor was down 1.4 per cent at 2,715 yen and Honda Motor shed 2.2 per cent to 2,501 yen in active trade after data showing their US sales dropped in August. Toyota's US sales fell 13 per cent last month and Honda's tumbled 24 per cent.
KDDI climbed 1.8 per cent to 583,000 yen after a ratings upgrade by Deutsche Securities and a Jiji news report that Tokyo Electric Power may sell about 200 billion yen worth of shares in KDDI back to the telecommunications company.
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