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Japanese Market Falls

The Japanese stock market is losing on Monday following the modest losses on Wall Street Friday after better-than-expected U.S. jobs data for the month of June lowered the prospects of an interest rate cut by the Federal Reserve. Investors also digested a raft of mixed local economic data, including weaker than expected Japanese core machine orders data for May.

The benchmark Nikkei 225 Index is down 128.83 points or 0.59 percent to 21,617.55, after touching a low of 21,562.63 earlier. Japanese shares rose in choppy trading on Friday.

The major exporters are mostly higher with modest gains despite a weaker yen. Sony is adding 0.5 percent, Canon is rising 0.2 percent and Panasonic is edging up 0.1 percent, while Mitsubishi Electric is down 0.1 percent.

Among tech stocks, Advantest is lower by more than 1 percent and Tokyo Electron is declining 0.2 percent. In the oil sector, Inpex is adding 0.3 percent, while Japan Petroleum is down 0.2 percent.

Market heavyweight SoftBank is declining more than 1 percent and Fast Retailing is lower by almost 1 percent. In the auto space, Honda Motor is adding 0.3 percent and Toyota Motor is up 0.4 percent.

Among the other major gainers, Chiyoda Corp. is higher by more than 2 percent and Resona Holdings is advancing almost 2 percent.

On the flip side, Aeon Co. is losing almost 5 percent, Suzuki Motor is lower by 4 percent and Sumitomo Dainippon Pharma is declining more than 3 percent.

In economic news, the Cabinet Office said that core machine orders in Japan were down 7.8 percent on month in May, worth 842.9 billion yen. That missed expectations for a decline of 3.7 percent following the 5.2 percent increase in April.

The Ministry of Finance said Japan posted a current account surplus of 1,594.8 billion yen in May, down 15.8 percent on year. That exceeded expectations for a surplus of 1,380.9 billion yen following the 1,707.4 billion yen surplus in April.

The trade balance reflected a deficit of 650.9 billion yen versus forecasts for a shortfall of 758.9 billion yen following the 98.2 billion yen deficit in the previous month. Exports were down 6.3 percent on year to 5,918.0 billion yen, while imports eased an annual 0.9 percent to 6,569.0 billion yen.

The Bank of Japan said that overall bank lending in Japan was up 2.3 percent on year in June, coming in at 536.641 trillion yen. That was in line with expectations and down from 2.6 percent in May.

In the currency market, the U.S. dollar is trading in the mid 108 yen range on Monday.

On Wall Street, stocks closed modestly lower on Friday, recovering from sharp losses early in the session. The early pullback by stocks came following the release of a closely-watched Labor Department report showing a substantial reacceleration in the pace of U.S. job growth in the month of June. While the data points to a rebound in the labor market following the weakness seen in May, the report dampened investor hopes for a near-term interest rate cut by the Federal Reserve.

The Dow fell by more than 230 points at its lows of the session but ended the day down just 43.88 points or 0.2 percent at 26,922.12. The Nasdaq edged down 8.44 points or 0.1 percent to 8,161.79 and the S&P 500 dipped 5.41 points or 0.2 percent to 2,990.41.

The major European markets also moved to the downside on Friday. While the U.K.'s FTSE 100 Index slid by 0.7 percent, the French CAC 40 Index and the German DAX Index both fell by 0.5 percent.

Crude oil futures settled modestly higher on Friday as traders continued to weigh the commodity's near-term supply and demand prospects. WTI crude for August ended up $0.17 or 0.3 percent at $57.51 a barrel on the New York Mercantile Exchange.

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