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Japan stocks skid on US economy fear, earnings drag

Japan stocks skid on US economy fear, earnings drag
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First Published: Wed, Feb 06 2008. 11 55 AM IST
Updated: Wed, Feb 06 2008. 11 55 AM IST
Reuters
Tokyo: Japanese stocks skidded more than 3% on Wednesday, 6 February, with exporters such as Canon Inc hit by growing fears of US recession, while a wave of outlook cuts by Japanese companies further dampened market sentiment.
As of 0444 GMT, the benchmark Nikkei average was down 3.7% or 505.48 points at 13,240.02.
The broader TOPIX index was down 3.3% at 1,310.40.
Japan’s top bank, Mitsubishi UFJ Financial Group, and other bank shares took a hit after Standard & Poor’s on Tuesday warned the ratings of US banks could be at risk.
“Investors are confirming the deterioration of both US and Japanese economies in their earnings results,” said Koichi Ogawa, chief portfolio manager, Daiwa SB Investments. He added Japanese corporate earnings so far had been largely hit by weak domestic demand, rather than by US-originated problems.
In Japan, about 700 companies that have already reported results on average expect to see a 6.4% rise in recurring profit for the year ending in March, according to data by Shinko Research Institute.
Nearly 15% of those that already reported revised down their full-year forecasts, while about 80% stuck to their original projections.
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First Published: Wed, Feb 06 2008. 11 55 AM IST
More Topics: Japan | Stocks | Nikkei | TOPIX | Canon Inc. |