TOKYO, June 7 (Reuters) - Japanese shares closed higher on Monday after U.S. jobs data eased concerns over an early tapering from the Federal Reserve, but heavy profit-taking capped gains amid caution before U.S. inflation readings due later this week.
The Nikkei share average edged up 0.27% to close at 29,019.24, after rising as high as 1% to reach a nearly four-week high earlier in the session.
The broader Topix reversed course to tick up 0.08% to 1,960.85.
The U.S. economy added 559,000 nonfarm payrolls in May, data showed on Friday, below economists’ forecast of 650,000, reducing expectations of an early tapering in the Fed’s asset purchase.
However, investors remain cautious as they look for more clues on possible tapering from the U.S. consumer price index (CPI) report this week, said Takatoshi Itoshima, strategist at Pictet Asset Management.
“Investors want to confirm whether there are risks for inflation from the CPI report,” said Itoshima.
Friday’s gain in the Nasdaq index boosted Japanese tech stocks, with electronic parts makers Ibiden rising 3.51% and TDK Corp adding 2.34%.
Shippers benefited from global bullish sentiment, rising 2.55% to a 10-year peak, with Nippon Yusen rising 2.37%, Kawasaki Kisen jumping 5.51% and Mitsui OSK Lines adding 2.26%.
However, profit-taking sank steelmakers, which had risen sharply this year on signs of a global recovery.
The steelmaker subindex dropped 4.71%, with Nippon Steel losing 5.74%, JFE Holdings shedding 7.2% and Kobe Steel falling 5.2%.
Hospitality shares, which had gained on Japan’s accelerated vaccine roll-outs, also lost traction, with department store operator Takashimaya dropping 1.84% and Isetan Mitsukoshi edging down 1.27%. (Reporting by Hideyuki Sano and Junko Fujita; Editing by Ramakrishnan M. and Devika Syamnath)