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Nikkei falls 1.1%, banks track Wall Street lower

Nikkei falls 1.1%, banks track Wall Street lower
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First Published: Thu, May 08 2008. 12 43 PM IST
Updated: Thu, May 08 2008. 12 43 PM IST
Tokyo: Japan’s Nikkei average fell 1.1% on Thursday, 8 May, its first negative day in three, as financials such as Mitsubishi UFJ Financial Group and other recent gainers were sold after a tumble on Wall Street.
The index’s fall accelerated briefly in the final hour of trade after Softbank Corp. plunged on a media report it might issue higher dividend preferred shares. Losses in Japan’s third-largest wireless carrier were later pared, ending down 3.3%.
“Today’s fall should not be a surprise,” said Fumiyuki Nakanishi, group manager, investment research department, SMBC Friend Securities. “A direct trigger was the fall on Wall Street, but a pause had been on the cards after the Tokyo market’s recent gain.”
The benchmark Nikkei has gained 19.6% from the recent bottom touched on 17 March.
Behind the recent recovery was foreign investors, who were net buyers of Japanese stocks for four straight weeks ending on 25 April.
“The situation is different from a month ago,” said Masashi Wakabayashi, general manager of the trading department at Meiji Dresdner Asset Management.
“I don’t feel the market has hit the ceiling yet. But rising prices of oil and commodities could put a hold on its upward move if investors start to worry that the negative impact on corporate earnings might be bigger than expected,” he said.
The benchmark Nikkei average fell 159.22 points to 13,943.26, a day after booking its highest close in four months.
The broader TOPIX index shed 1.5% to 1,372.95.
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First Published: Thu, May 08 2008. 12 43 PM IST
More Topics: Markets | Japan | Stocks | Nikkei | TOPIX |