Japanese shares fall on disappointing corporate outlook

·2 min read

By Junko Fujita

TOKYO, Oct 28 (Reuters) - Japanese shares fell on Thursday, as disappointing outlook by technology blue-chip companies prompted a broader sell-off, though gains in heavyweight chip-related shares limited losses.

The Nikkei share average was down 0.9% to 28,829.54 by 0206 GMT, while the broader Topix fell 0.65% to 2,000.68.

"I had expected some companies would miss market expectations at this earnings season but downward revisions were a big surprise. That has hurt investor sentiment," said Shigetoshi Kamada, general manager at the research department at Tachibana Securities.

"Investors are awaiting Toyota's earnings next week because automakers affect their related industries. At the same time the U.S. Fed's policy meeting is also a big factor for their sentiment."

Robot maker Fanuc tumbled 8.54% as it cut outlook for this year, citing shortages of chips and other parts.

Hitachi lost 1.39% production cut of automakers due to lack of chips had affected the technology conglomerate.

Computer maker Fujitsu also fell 8% after its outlook missed expectations.

Japanese market also tracked an overnight weaker finish of S&P 500, which ended lower due to a drop in oil prices and a pullback in Treasury yields.

Investors remained cautious about central banks' rate policies ahead of the Fed's policy meeting next week, Kamada said.

On Thursday the Bank of Japan is expected to keep monetary policy settings steady, and also project inflation to stay below its 2% target for at least two more years.

On the other hand, silicon wafer maker Shin-Etsu Chemical gained 3.21% and chip-making equipment maker Screen Holdings jumped 8.74 on robust earnings.

Their peers Tokyo Electron rose 1.96% and Advantest jumped 3.61%, limiting overall losses on Nikkei.

(Reporting by Junko Fujita; Editing by Rashmi Aich)

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