Japan's Nikkei edges down, off near 2-week high amid election outcome worries
TOKYO, July 18 (Reuters) - Japan's Nikkei share average slipped from a more than two-week high to trade lower on Friday as investors weighed the outcome of the nation's upper house election due on the weekend.
The Nikkei .N225 slipped 0.31% to 39,778.85 by the midday break. Earlier, it had risen to as much as 40,087.59, its highest level since July 1, underpinned by the strong performance of Wall Street, but fell soon as investors started selling to book profits.
The S&P 500 .SPX stock index and the Nasdaq Composite .IXIC both finished at record highs on Thursday, as investors embraced strong economic data and earnings reports that showed American consumers remained willing to spend. .N
For the week, the Nikkei is set to rise 0.5% and snap a two straight weeks of losses.
The broader Topix .TOPX was down 0.13% to 2,836.1.
"Investors did not want to take a risk in buying stocks ahead of the national election on the weekend," said Yugo Tsuboi, chief strategist at Daiwa Securities.
"But the momentum is not bad as about half the stocks rose."
Prime Minister Shigeru Ishiba's Liberal Democratic Party (LDP) and its partner Komeito are expected to lose their majority in the upper house on Sunday.
Strategists now focus on whether Ishiba will remain in his position or step down after the election, as a gauge of the nation's potential policy shift, which could lead to a cut in the national consumption tax.
Chip-related heavyweight fell, with Advantest 6857.T and Tokyo Electron 8035.T losing 4.27% and 0.7%, respectively.
Disco 6146.T tanked 10.26% to become the biggest percentage loser on the Nikkei, as the chipmaking device supplier's quarterly operating profit forecast missed market expectations.
Uniqlo-brand owner Fast Retailing 9983.T rose 0.79% to provide the biggest support to the Nikkei. Technology investor SoftBank Group 9984.T rose 1.5%.
Of more than 1,600 stocks on the Tokyo Stock Exchange's prime section, 42% rose and 53% fell, and 4% traded flat.
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