TOKYO: Tokyo shares opened lower Wednesday after three straight winning sessions, as investors focus on Britain’s upcoming referendum on European Union membership.
The Japanese market shrugged off a rise on Wall Street, with many investors keeping to the sidelines ahead of Thursday’s historic vote.
“What investors hate the most is uncertainty,” said Chihiro Ohta, a senior strategist at SMBC Nikko Securities.
“Most are just waiting on the sidelines to see what happens.”
Opinion polls showed a tight race although the websites of six major bookmakers showed the odds heavily pointing to a “Remain” vote, with the likelihood of Britain staying in the EU put at around 80 percent.
“A lot of people think this means that exit now won’t happen,” said Matthew Sherwood, head of investment strategy at Perpetual.
“Markets have become somewhat complacent about Brexit risk as the outcome remains highly uncertain and the predictive power of UK polls is highly questionable,” he told Bloomberg News.
The benchmark Nikkei 225 index fell 0.45 percent, or 73.30 points, to 16,095.81 shortly after opening, while the Topix index of all first-section shares declined 0.43 percent, or 5.53 points, to 1,288.37.
On currency markets, the dollar stood at 104.67 yen, against 104.80 yen in New York Tuesday.
Federal Reserve Chair Janet Yellen warned Tuesday that the US economy faces “considerable uncertainty” from slower domestic activity and from a possible British exit from the EU.
In testimony to the Senate Banking Committee, Yellen also said she wants the economy to be on a “favourable path” before the central bank considers hiking benchmark interest rates, as investors face further evidence that world growth remains tepid.
In New York the Dow Jones Industrial Average edged up 0.1 percent, the broad-based S&P 500 climbed 0.3 percent, while the tech-rich Nasdaq Composite Index advanced 0.1 percent.
