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Japanese Market Modestly Lower

The Japanese stock market is modestly lower on Tuesday in choppy trading despite the positive cues overnight from Wall Street, while the safe-haven yen strengthened against the U.S. dollar.

Investor sentiment was dampened due to the rising number of new coronavirus cases in Tokyo and data showing that Japanese household spending tumbled at the fastest pace on record in May.

The benchmark Nikkei 225 Index is down 38.83 points or 0.17 percent to 22,675.61, after touching a high of 22,742.28 in early trades. Japanese shares rose on Monday for the fourth straight day.

Market heavyweight SoftBank Group is gaining almost 4 percent, while Fast Retailing is down 0.6 percent.

The major exporters are lower on a stronger yen. Sony is losing almost 1 percent, Mitsubishi Electric is lower by 0.5 percent and Canon is down 0.4 percent, while Panasonic is adding 0.5 percent.

In the financial sector, Mitsubishi UFJ Financial is declining almost 1 percent and Sumitomo Mitsui Financial is down 0.5 percent.

In the tech space, Advantest is rising more than 3 percent and Tokyo Electron is higher by almost 2 percent. Among automakers, Honda is lower by more than 1 percent and Toyota is declining almost 1 percent.

In the oil sector, Japan Petroleum and Inpex are losing more than 1 percent each after crude oil prices ended almost flat overnight.

Among the other major gainers, Yamato Holdings is gaining more than 4 percent, while Cyberagent, Rakuten and M3 are all rising more than 3 percent each.

On the flip side, Nissan Motor is lower by more than 3 percent and Tokyu Corp. is lower by almost 3 percent.

In economic news, the average of household spending in Japan was down 16.2 percent on year in May, coming in at 252,017 yen. That missed expectations for a drop of 12.2 percent following the 11.1 percent decline in April.

Japan will also release May numbers for its leading and coincident indexes.

In the currency market, the U.S. dollar is trading in the lower 107 yen-range on Tuesday.

On Wall Street, stocks closed higher on Monday after Chinese shares skyrocketed on the day amid positive commentary on the market from state media. Traders also remained generally optimistic about the U.S. economic outlook following last Thursday's better than expected jobs data. In the latest sign of the rapid economic recovery, the Institute for Supply Management released a report showing a substantial turnaround in U.S. service sector activity in the month of June.

The Nasdaq soared 226.02 points or 2.2 percent to 10,433.65, the Dow surged up 459.67 points or 1.8 percent to 26,287.03 and the S&P 500 jumped 49.71 points or 1.6 percent to 3,179.72.

The major European markets also showed strong moves to the upside on Monday. While the U.K.'s FTSE 100 Index jumped by 2.1 percent, the German DAX Index and the French CAC 40 Index rallied by 1.6 percent and 1.5 percent, respectively.

Crude oil futures settled slightly lower on Monday after swinging between gains and losses as traders weighed energy demand prospects and fears of another lockdown amid a surge in new coronavirus cases across the globe. WTI crude oil for August delivery edged down $0.02 to $40.63 a barrel.

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