Japanese shares slide on financial jitters

Japanese shares slide on financial jitters
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First Published: Wed, Aug 13 2008. 02 49 PM IST
Updated: Wed, Aug 13 2008. 02 49 PM IST
Tokyo: Japanese share prices closed down 2.11% on 13 August, hit by renewed worries about the health of the world’s top banks and news of a contraction in the domestic economy, dealers said.
They said exporter shares suffered after the dollar fell back below the 109 yen level, dimming prospects for Japanese companies’ overseas earnings.
The Tokyo Stock Exchange’s benchmark Nikkei-225 index lost 280.55 points to end at 13,023.05. The broader Topix index of all first-section shares declined 24.94 points or 1.96% to 1,246.48.
Investors were unnerved after Wall Street giant JPMorgan Chase and Swiss rival UBS both reported losses due to their exposure to the crumbling US mortgage market.
“Investors started feeling jittery about the US financial sector again,” Fumiyuki Nakanishi, a strategist at SMBC Friend Securities, said.
Banking issues came under pressure here. Mitsubishi UFJ Financial dropped 4.2% to 841 yen as some market players questioned the merits of a move by the bank to take full control of US subsidiary UnionBanCal.
“Investors didn’t welcome the buyout of a US financial institution when they are concerned about the health of the US economy,” said a fund manager at a Japanese asset management firm.
Other financial shares also fell sharply, with top brokerage firm Nomura Holdings down 4.4% at 1,505 yen.
Real estate issues were dumped after the government said housing investment declined 3.4% in the second quarter, contributing to a 0.6% contraction in the overall economy.
Sumitomo Realty & Development lost 4.9% to 2,125 yen and Mitsui Fudosan dropped 3.3% to 2,320 yen.
Exporters declined due to the stronger yen. Sony shed 3.0% to 4,210 yen and Canon fell 2.4% to 5,210 yen.
The greenback was at 108.74 yen in Tokyo afternoon trade, down from 109.31 in New York late 12 August. The euro fell to 162.26 yen from 163.08.
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First Published: Wed, Aug 13 2008. 02 49 PM IST
More Topics: Stocks | Japan | Economy | Nikkei | Topix |