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2ND LD: Tokyo stocks extend sharp losses, Nikkei briefly falls below 10,000+(Japan Economic Newswire Via Acquire Media NewsEdge) TOKYO, Oct. 7_(Kyodo) _ (EDS: CLARIFYING 2ND GRAF, ADDING DETAILS AND PRICES) Tokyo stocks closed sharply lower Tuesday on mounting concerns about the slowing world economy and the global repercussions of the U.S.-triggered financial crisis, with the key Nikkei index ending 3 percent lower after trimming part of wider losses which sent the index below the 10,000 mark for the first time since December 2003. The 225-issue Nikkei Stock Average ended by losing 317.19 points, or 3.03 percent, from Monday to 10,155.90, after hitting the day's low of 9,916.21, down 556.88 points, or 5.32 percent in the morning. The Nikkei last dropped below the threshold during trading hours on Dec. 11, 2003. The broader Topix index of all First Section issues on the Tokyo Stock Exchange was down 21.44 points, or 2.15 percent, to 977.61. Brokers said Tokyo stocks remained weak but that after the indexes suffered a more than 5 percent loss in the morning, they pulled back somewhat in afternoon trading due partly to rises in some Asian equities and a market view that stocks have been oversold. Among Asian stocks that rose were Australian shares due to the Australian central bank's move to cut interest rates to weather the financial crisis, brokers said. Tsuyoshi Segawa, an equity strategist at Shinko Securities Co., said, "Seeing the plunge in Tokyo stocks yesterday and today, investors felt this sense of wariness that stocks have been oversold." But reflecting the overall bearish market sentiment, which has driven the Nikkei down more than 1,200 points from last Thursday through Tuesday, the Tokyo market is likely to show a sluggish performance as there are no visible signs yet the financial turmoil is bottoming out. "For now, the typhoon has left, but we still need more time to confirm if the typhoon has really left in the strictest sense or we are simply in the eye of the typhoon," Segawa said. Major decliners included pharmaceutical, transport equipment, and forestry and fishery issues. Five sectors turned in gains -- pulp and paper, real estate, insurance, iron and steel, and miscellaneous product issues. Yumi Nishimura, deputy general manager of the global product planning department at Daiwa Securities SMBC Co., also said investors are concerned about the effectiveness of the U.S. financial bailout package, which became law Friday, and warned that the financial turmoil is also engulfing Europe. Hiroichi Nishi, equities chief at Nikko Cordial Securities Inc., said that selling gained momentum out of investor "disappointment" over the outcome of an emergency conference in Paris on Saturday by the leaders of Britain, France, Germany and Italy. Market players feel the leaders failed to work out effective measures to prevent the financial turmoil from escalating, he said. Tokyo stocks weakened in tandem with a continued global sell-off, compounded by the overnight plunge on Wall Street which saw the Dow Jones industrials end below 10,000 for the first time since 2004. If the situation in the U.S. and European financial markets and economies continues to deteriorate, Nishimura said Japanese firms are likely to revise downward their earnings reports. Banking issues were mostly weak, with value leader Mizuho Financial Group falling 11,000 yen, or nearly 3 percent, to 391,000 yen. Mitsubishi UFJ Financial Group, meanwhile, climbed 5 yen, or nearly 1 percent, to 811 yen, after the U.S. Federal Reserve gave it approval Monday to take a stake of up to 24.9 percent in struggling U.S. investment bank Morgan Stanley on a voting rights basis. On the First Section, declining issues outnumbered advancing ones 1,356 to 315, with 42 others remaining unchanged. Other notable decliners were export-oriented auto and high-tech issues as investor sentiment was further battered by a stronger yen against the U.S. dollar and euro. Among them, Toyota Motor lost 190 yen, or nearly 5 percent, to 3,710 yen, and hit a year-to-date low at one point at 3,580 yen, and Canon shed 150 yen, or over 4 percent, to 3,530 yen. Trading volume on the main section came to 2,965.13 million shares, up from Monday's 2,566.95 million. Nippon Steel, the day's volume leader, ended unchanged from the previous day at 319 yen after falling during trading hours. Trading house Mitsui & Co. bucked the downward trend by rising 4 yen, or 0.36 percent, to 1,118 yen, after saying it will make an additional investment of $123.75 million in the Brazilian agricultural business of Swiss-based Multigrain AG, boosting its stake to become one of Multigrain's two largest shareholders. The TSE's Second Section index was down 83.63 points, or 3.94 percent, to 2,037.52 on a volume of 88.12 million shares. On the Osaka Securities Exchange, the near-term December Nikkei 225 index futures contract was down 240 points to 10,210. Copyright ? 2008 Kyodo News International, Inc. |