Tokyo stocks slip by break ahead of BoJ, Fed decisions

Tokyo stocks fell Wednesday morning as Japan's corporate earnings season got off to a shaky start, while traders await policy decisions from the Federal Reserve and Bank of Japan.

Copier and camera maker Canon plunged 5.83 percent to 3,184 yen, while firms that supply Apple fell after iPhone sales fell for the first time.

Canon on Tuesday said its net profit for the three months to March dropped 17.5 percent, as it downgraded its full-year profit and sales forecasts due to China's economic slowdown and the resurgent yen.

"If a company posts double-digit declines in earnings, it's going to get whacked," Chihiro Ohta, senior strategist at SMBC Nikko Securities, told Bloomberg News.

"I think we're going to see quite a few companies post drops like that."

On Wednesday, Tokyo's benchmark Nikkei 225 index fell 0.58 percent, or 100.27 points, to 17,253.01 by the lunch break, while the broader Topix index of all first-section shares was down 0.79 percent, or 11.02 points, at 1,380.67.

The US central bank will wrap up its latest meeting with a statement that could shed light on its plans for interest rates.

After the turmoil across world markets earlier this year, the Fed has lowered its forecasts for borrowing costs in 2016, saying it will closely watch overseas developments before making a move.

The Bank of Japan's two-day meeting, which ends Thursday, is also in focus with policymakers widely expected to unleash more stimulus after this month's deadly earthquakes.

The disaster led to factory closures at a time when the world's third-largest economy is already struggling.

Scandal-hit Mitsubishi Motors, videogame giant Nintendo and factory robotics maker Fanuc are among the companies set to report results for the fiscal year through March on Wednesday.

Sony, Panasonic, Japan Airlines and All Nippon Airways are due to report financial results Thursday in a busy week for Japan's corporate earnings.

On Wednesday, automaker Mitsubishi dropped another 2.53 percent to 423 yen, following fresh revelations that it has been using dodgy fuel-efficiency testing for 25 years and as it admitted it has no idea of the scale of the cheating that has plunged the company into crisis.

Meanwhile, firms that provide parts for Apple products fell after the US tech giant said that waning demand for its popular handset caused its first dip in revenue since 2003 and was likely to continue this year as China's slowdown weighs.

Japan Display was almost one percent down, Alps Electric shed 1.8 percent and Taiyo Yuden was off 1.5 percent.

On currency markets, the dollar dipped to 111.08 yen on Wednesday from 111.31 yen Tuesday in New York.

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