Nikkei closes at eight-month low amid subprime woes

Nikkei closes at eight-month low amid subprime woes
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First Published: Wed, Aug 15 2007. 01 00 PM IST
Updated: Wed, Aug 15 2007. 01 00 PM IST
AFP
Tokyo: Japanese share prices closed down 2.19% on Wednesday, 15 August, at an eight-month low as worries over the troubled US mortgage sector continued to shake global markets, dealers said.
They said stock markets were coming under renewed pressure across Asia in the wake of a continued selloff on Wall Street, despite continued efforts by central banks to avert a credit squeeze.
The Tokyo Stock Exchange’s benchmark Nikkei-225 index of leading shares tumbled 369.00 points to end at 16,475.61, the lowest closing level since 8 December, 2006.
The broader Topix index of all first-section shares slumped 43.31 points or 2.64% to 1,594.15, dropping below the key 1,600 level.
The Tokyo market buckled after two days of relative calm, after US and European stock markets suffered heavy losses overnight.
Worries about the fallout from the US mortgage problems have wreaked havoc on global markets recently.
Japanese banking shares in particular were under heavy pressure amid concerns about the fallout from the problems in US subprime lending to customers with patchy credit histories.
“It appears that foreign players have moved aggressively to cash in equities holdings in order to restructure their portfolios in favor of bonds,” said Yukihiro Takahashi, a market analyst at Ichiyoshi Securities.
Dealers said that a stronger yen also hit Japanese shares because of concerns that it will hit exporter earnings.
The yen spiked up to four-month highs against the dollar and the euro as fresh turbulence on global stock markets prompted players to scale down risky bets funded by selling the Japanese currency.
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First Published: Wed, Aug 15 2007. 01 00 PM IST
More Topics: Stocks | Japan | Nikkei | Topix | subprime crisis |