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Nikkei turns positive after touching 26-yr low

Nikkei turns positive after touching 26-yr low
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First Published: Tue, Mar 03 2009. 10 10 AM IST
Updated: Tue, Mar 03 2009. 10 10 AM IST
Tokyo: Japan’s Nikkei average turned positive on Tuesday after hitting a four-month low earlier as investors picked up beaten-down shares such as Sony Corp.
The benchmark Nikkei rose 0.1% to 7,286.80. after falling as low as 7,088.47 during morning trade - a level unseen since a 26-year low of 6,994.90 hit on 28 October.
The broader Topix slipped 0.5% to 731.31 after briefly hitting a 25-year low.
Japanese stocks fell to a fresh 26-year low Tuesday after the DowJones industrial average closed below 7,000 for the first time in more than 11 years on growing fears over the health of the US financial sector.
The benchmark Nikkei 225 stock average tumbled 104.82 points, or 1.44%, to 7,175.33 in the morning trade, extending further losses after a 3.8% drop on Monday that marked a fresh 26-year low for the Nikkei, which closed at 7,114.64 on 7 October, 1982.
The broader Topix index also fell 1.67% to 722.32.
“Investors are becoming nervous about the state of the US financial sector. They were worried about deteriorating assets in the US financial sector,” said Kazuhiro Takahashi, equity strategist at Daiwa Securities SMBC Co. Ltd.
Investors were jittery after insurer American International Group Inc. reported a staggering $61.7 billion in quarterly losses, sparking fresh fears about the health of the US financial system. The worries pressured the Dow, which fell 299.64, or 4.24%, to 6,763.29. The Dow last closed below 7,000 on 1 May, 1997.
The US credit crisis and recession have slashed more than half the average’s value since it hit a record high over 14,000 in October 2007. And now many investors fear the market could take a long time to regain the lost 7,000.
Apart from AIG’s massive losses, investors were spooked as HSBC PLC, Europe’s largest bank by market value, said Monday it needs to raise $17.7 billion. The company reported a 70% drop in 2008 earnings and said it would cut 6,100 jobs.
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First Published: Tue, Mar 03 2009. 10 10 AM IST
More Topics: Japan | Markets | AIG | DowJones | Nikkei |