Japan's Nikkei falls as US-Iran tensions unsettle investors

By Satoshi Sugiyama

TOKYO, Feb 20 (Reuters) - Japan's Nikkei share average fell on Friday as heightened U.S.-Iran tensions and a sell-off in U.S. private‑equity shares dented sentiment.

The Nikkei .N225 dipped 1.1% to close at 56,825.70, breaking a two-week rally to log a 0.2% weekly drop. The broader Topix .TOPX sank 1.1% to 3,808.48, and edged down 0.3% for the week.

U.S. President Donald Trump warned Iran it must make a deal over its nuclear program or "really bad things" will happen, and set a deadline of 10 to 15 days, drawing a threat from Tehran to retaliate against U.S. bases in the region if attacked.

"With a three-day weekend coming up (in Japan), there's a move to lock in profits for now on concern that something might happen between the U.S. and Iran during the holiday," said Yutaka Miura, senior technical analyst at Mizuho Securities.

Japanese air carriers Japan Airlines 9201.T shaved 3.1% and ANA Holdings 9202.T lost 2.7%.

In addition, Blue Owl Capital's OWL.N announcement on selling assets and suspending redemptions at one of its funds dragged the Japanese market, where the securities sector led declines in the Tokyo Stock Exchange's 33 industry sub‑indexes.

Internet banking giant SBI Holdings 8473.T tumbled 4%, the steepest fall since last December. Nomura Holdings 8604.T, Japan's largest brokerage, sank 3.7%.

Meanwhile, drugmaker Sumitomo Pharma's 4506.T shares plunged almost 16%, their biggest drop since February 2024, on profit-taking.

In choppy trading, shares had risen as much as 6.8% earlier on Friday, after a Japanese health ministry panel late Thursday approved the drugmaker's iPS cell-derived treatment for Parkinson's disease.

The stock's 14-day relative strength index (RSI) reached 74.8 on Tuesday. A figure above 70 indicates that the price gain is overstretched.

There were 58 advancers on the Nikkei index against 166 decliners.