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Somewhat Disconcerting
| Good [+1]Toggle ReplyLink» basdini a répondu le Thu 18 May, 2006 @ 4:00am |
 Coolness: 145215 | TOKYO, Japan (Reuters) -- Tokyo's Nikkei share average fell 1.35 percent on Thursday to its lowest close in more than two months as Honda Motor and others took a hit after a sharp sell-off in U.S. stocks.
Billions of dollars have been wiped from global share markets in the past day under fears of inflation and rate rises. Earlier Thursday, the Nikkei had fallen by more than 2.4 percent, but a halt in the yen's rise drew bargain-hunting toward the close for stocks with good earnings prospects. The Nikkei ended down 220.49 points at 16,087.18, its lowest close since March 9. At its lowest point for the day, it touched 15,914.39. The TOPIX index fell 1.51 percent to 1,632.08. Other markets in the region were also off sharply, with South Korea's Kospi ending down 2.59 percent and Australia's S&P/ASX200 finishing 1.88 percent lower. Taiwan lost 1.16 percent and New Zealand gave up 0.28 percent. Singapore is showing a fall of about 2.15 percent heading towards the close, while Hong Kong is down 2 percent. Shares of Japanese brokerages and insurers declined as investors worried about the impact of the stock market's slide on their earnings, although Daikin Industries climbed after it said it was considering buying a Malaysian firm. Steep declines in U.S. stocks -- the Dow Jones industrial average recorded its biggest one-day point drop in three years on Wednesday -- surprised the Tokyo market, said Soichiro Monji, chief strategist of equity management at Daiwa SB Investments. "Rather than any domestic factor, I think the decline in U.S. stocks is pretty much 100-percent responsible for the fall in Tokyo today," he said. But with the yen substantially weaker against the dollar, the sell-off was not likely to last, Monji said. "For the near future, I think today is likely to mark the climax of selling, of investors completely ignoring the weaker yen." The yen was at 110.72 to the dollar after the share market closed Thursday, off an eight-month high of 108.96 hit on Wednesday. A weaker yen helps Japan's exporters as it increases profits when revenues from abroad are brought home. Fanuc, a maker of industrial robots, dropped 2.3 percent to 10,350 yen. TDK Corp., a maker of electronic components, slid 3.5 percent to 9,440 yen, erasing almost all of its gains from the previous session. Sony Corp. fell 2.1 percent to 5,090 as investors shrugged off a brokerage upgrade of the electronics and entertainment conglomerate. Steady decline The Nikkei has now booked its seventh decline in eight sessions, having erased about 1,300 points since its close on May 8. But the decline has been welcome news to those who thought stock prices were overheated, said Kirby Daley, strategist at Fimat. "We're taking some of the premium out of the markets (in Japan and the U.S.) that maybe didn't deserve to be there at this point," he said. However, he added that anything under 16,000 was too low for the benchmark. "Now we're getting into slightly undervalued territory, we should not see a 15,000 handle on the Nikkei at this point." Brokerage Nomura Holdings Inc. fell 3.8 percent to 2,280 yen. The company said it plans to pay investors a dividend of 32 yen per share in the financial year to March 2007, compared with 48 yen per share a year ago. Insurer T&D Holdings Inc. fell 5.8 percent to 7,630 yen. Insurers, like brokerages, were squeezed by concerns that lower stock prices will eat into their earnings from the market, said Daiwa SB's Monji. But shares of Daikin jumped 5.1 percent to 3,920 yen after the manufacturer of air conditioners said it was considering buying Malaysian firm OYL Industries Bhd. The deal would make Daikin the world's second-largest maker of air conditioners, the Nihon Keizai said. |
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