Nikkei tumbles to three-week low, mixed cues about economic recovery

www.chinaview.cn 2009-11-02 19:49:48 Print
http://news.xinhuanet.com/english/2009-11/...nt_12373590.htm


TOKYO, Nov. 2 (Xinhua) -- Japan's 225-issue Nikkei Stock Average closed at a three-week low Monday declining 2.3 percent to9,802.95 as corporate earnings reports from key Japanese companies disappointed investors and sparked further pessimism about a global economic upturn.

A stronger yen and a weak consumer spending report by the U.S. Commerce Department showing that spending in September dipped 0.5 percent from the previous month, led to a wholesale Wall Street cash-in that hit Japanese exporters.

The broader Topix index of all First Section issues on the Tokyo Stock Exchange was down 14.13 points, or 1.6 percent to 880.54.

"Uncertainty about the U.S. economic outlook is once again growing as the (Commerce Department) report stoked concern about sluggish personal consumption during the Christmas shopping season," said Hiroichi Nishi, Equity Manager at Nikko Cordial Securities Inc.

Consumer lenders saw an upturn Monday, however, after reports claimed the government may ease tough regulations that have been stifling the industry and issues that have made it hard for small-business to secure loans are to be readdressed according to the report.

Japanese consumer lender Aiful jumped 17.3 percent to 156 yen, while rival Takefuji rocketed 23.1 percent to 427 yen. Consumer credit firm Credit Saison Co. Ltd. surged 16.5 percent to 1,214 yen.

Japanese exporter Canon Inc. dropped 3.1 percent to 3,420 yen, whilst Kyocera Corp. slid 4.5 percent to 7,400 yen. Honda Motor Co. lost 2.1 percent to 2,820 yen.

After close Monday, Suzuki Motor Corp. raised its annual profit forecasts on strong sales in India as opposed to the U.S. but closed down 2.9 percent at 2,170 yen.

Sony Corp. declined 5.8 percent to 2,625 yen, despite the company's upward revision of its previous earnings forecast. The lack of positively surprising cues from earnings announced on Friday's prompted profit-taking Monday, according to analysts.

"The results weren't bad at all but there wasn't much of a surprise either, and that prompted investors to sell on the fact," said Noritsugu Hirakawa, a strategist at Okasan Securities.

Mitsubishi Corp., fell 3.1 percent on lower commodity prices while Canon Inc., Japan's leading camera manufacturer dropped 3.1 percent. Daiwa Securities Group Inc. shed 4.5 percent as Japan's No. 2 brokerage reported second-quarter results that fell short of market expectations.

"While shares in Asia are down, the fact that falls were limited and the yen has actually retreated a bit against the dollar have helped keep the Nikkei from sliding further," said Kenichi Hirano at Tachibana Securities.

Markets became circumspect as CIT Group Inc. filed the biggest bankruptcy claim one of the largest in U.S. corporate history and rumors about Citigroup's solvency also concerned investors Monday.

"If, for example, there was worry the way there was when Lehman failed, there would have been much sharper falls," said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities.

"The CIT failure appears much more managed, much more like GM in that way. It's not at all the same thing."

Trade was thin on the Tokyo exchange's First Section, with 1.8 billion shares changing hands, below last week's daily average of 2 billion.

Across both Sections Monday, declining stocks outnumbered advancing ones by more than 2 to 1.