Japan's Nikkei logs worst week in a month on U.S. rates, Ukraine worries

TOKYO - Japan's Nikkei index logged its worst week in close to a month, weighed by worries from the impact of aggressive policy tightening by the U.S. Federal Reserve, the conflict in Ukraine, and lockdowns in China.

The Nikkei sank 2.46% for the week, its poorest showing since the period ended March 11, despite notching small gains at the end of a roller-coaster session on Friday. It ended up 0.36% at 26,985.80, stopping short of the psychological 27,000 level.

The broader Topix added 0.21% to 1,896.79, but lost 2.44% for the week, also the worst performance since March 11.


Over the course of the week, China tightened restrictions on movement amid a COVID-19 outbreak, bringing life in Shanghai to a virtual standstill, while Ukraine braced for a major Russian offensive with peace talks sputtering.

A particular focus was the U.S. Federal Reserve, with policymakers sounding increasingly hawkish notes in recent days.

"The Fed's hawkish tilt is making it very hard to buy growth stocks," said a trader at a domestic securities firm.

"At the same time, the climb in U.S. yields has come a long way, meaning a lot of tightening is already priced in, so stocks shouldn't fall too much either."

Of the Nikkei's 225 components, 134 rose on Friday versus 85 that fell, with six ending flat.

Camera maker Nikon was the Nikkei's biggest winner, jumping 7.55% after announcing a 30 billion yen ($241.82 million) share buyback.

Telecoms also climbed, with NTT up 4.04% and KDDI rising 1.84% to be the Nikkei's biggest gainer by index points.

At the other end, Toyota dropped 3.37% to be the Nikkei's biggest drag amid Australian media reports that the automaker could face an A$2 billion ($1.5 billion) payout over faulty diesel particulate filters.

That led transport equipment to be the worst performer among the Tokyo Stock Exchange's 33 sub-sectors, registering a 2.08% decline.