Tokyo shares slip by break as BoJ meeting starts

Tokyo shares slipped Thursday morning with financials down as the Bank of Japan kicked off a closely watched policy meeting, with traders waiting to find out if it delivers on an expected stimulus package.

The gathering is the BoJ's first since Britain's shock vote to quit the European Union hammered financial markets and sparked a rally in the safe-haven yen, which hit Japan Inc's bottom line.

The talks come after the government on Wednesday announced a whopping 28 trillion yen ($266 billion) stimulus aimed at shoring up sluggish growth in the world's number three economy.

The BoJ could expand its mammoth asset buying plan or cut interest rates further into negative territory in a bid to stir lending and stoke the wider economy.

The rate plan has been unpopular among Japanese banks, however, as it effectively charges them to keep excess reserves in the BoJ's vaults.

"Investors are wary that the BoJ will disappoint and it'll lead to a bout of selling," Mitsushige Akino, a Tokyo-based executive officer at Ichiyoshi Asset Management, told Bloomberg News.

"The bar has already been raised too high for the BoJ's policies. Unless there's some sort of policy that crosses that line... Japanese stocks will be sold and the yen will be bought."

By the break, the benchmark Nikkei 225 index was 0.69 percent, or 114.56 points, lower at 16,550.26, after surging the previous day on the government announcement.

The broader Topix index of all first-section shares dropped 0.86 percent, or 11.31 points, to 1,310.36.

The dollar eased to 104.97 yen from 105.31 yen Wednesday in New York, after the Federal Reserve indicated it would take a slow, measured approach to any interest rate hikes.

Mitsubishi UFJ Financial Group was off 2.67 percent at 484 yen while rival Sumitomo Mitsui Financial Group was down 2.48 percent at 3,063 yen after saying Wednesday net profit tumbled 31 percent in April-June.

Nintendo slumped 5.64 percent to 21,045 yen after the videogame giant said Wednesday it logged a huge first quarter net loss, citing the impact of a strong yen. The loss came despite the Pokemon Go mania sweeping the globe since its launch earlier this month.

Nissan edged down 0.23 percent to 1,044 yen after reporting on Wednesday its first decline in net profit in four years in the past quarter, blaming the yen and struggles in its home market.

Fujifilm plummeted 9.28 percent to 3,675 yen on disappointing first-quarter earnings and Japan Airlines lost 4.15 percent to 3,181 yen after a report warned the carrier's profits would fall.

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