Tokyo: Japan’s Nikkei stock average edged up 0.1% as nonferrous metal smelters such as Sumitomo Metal Mining Co Ltd rose after nickel prices leapt on supply worries.
But Mitsui OSK Lines Ltd and other shipping firms weighed on the market as investors worried about the impact of high oil prices on corporate earnings amid concerns about the stymying effects of inflation.
The benchmark Nikkei average was on its way to posting the worst weekly drop in three months.
“Just like New York, inflation concerns are dramatically increasing in the Tokyo market. Potentially bigger profit declines from high oil prices are holding back investors,” said Katsuhiko Kodama, senior strategist at Toyo Securities.
“The effect of a softer yen on exporters is cancelled out by worries about inflation and possible interest rate hikes.”
The benchmark Nikkei average was up 16.20 points at 13,904.80, while the broader Topix was flat at 1,362.49 in morning trade.
US crude oil was up 10 cents at $136.84 a barrel, within sight of last week’s record $139.12.
The dollar slipped 0.2% against the yen from late US trade on Thursday to 107.70 yen stepping back from a nearly four-month high of 108.08 yen hit the previous day.
Sumitomo Metal Mining jumped 3.4% to 1,688 yen and rival nonferrous metal smelter Mitsui Mining & Smelting rose 0.9% to 332 yen.
London Metal Exchange nickel hit $24,600 a tonne, its highest since May 22, after BHP Billiton surprised the market with the early shutdown for repairs of its Kalgoorlie nickel operations in Western Australia.
Shipping firms extended losses as a key freight index had its biggest drop ever on concerns about a pullback in demand for commodities from big consumers such as China.