Nikkei closes at fresh 4-month low, JAL takes a nosedive
Nikkei closes at fresh 4-month low, JAL takes a nosedive
20:24, November 24, 2009 
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Japan's 225-issue Nikkei Stock Average sank for the fifth successive session Tuesday as continuing concerns about corporate equity financing, government fiscal policy and a strengthening yen soured investor sentiment. Following the three-day weekend Japan's key benchmark Nikkei lost 96.10 points, or 1.01 percent, from Friday to 9,401.58, it's lowest close since July 17.
The broader Topix index of all First Section issues on the Tokyo Stock Exchange had its lowest close since April 28, losing 9.49 points to 829.22.
Exporter and tech-shares were hit by the dollar hovering around the 88 yen mark meaning losses for investors as a strong yen cripples profits when repatriated into Japanese currency. Commercial and diversified banking issues also dragged on the market Tuesday, as did cash-strapped Japan Airlines Corp.
Japan Airlines Corp. crashed 8.4 percent to a record low of 87 yen on Tuesday. Investor concern is mounting as to whether the cash-strapped carrier can resolve its impending bankruptcy issues by current employees and retirees accepting a 30 percent cut in pension provisions, before a state-led bailout plan becomes feasible.
As Japan's leading carrier lays out wholesale cost-cutting plans, including axing a number of international and domestic routes as well as downsizing its fleet, investor sentiment was further dashed following news that the trading house Mitsui had sold its entire stake of 11.73 million shares in JAL during the six months to September 30th. A spokesperson for the trading house declined to comment on exactly why they had decided to offload all of their shares in JAL.
Investors retreated from riskier assets today as Japan's Finance Minister Hirohisa said that Japanese demand was weak and monetary policy is the key to fighting deflation, signaling the central bank should do more to stem price declines.
Impacted by a strong yen and antsy trading, exporters like Sony Corp. lost 1.87 points to 2,365 yen. Japan's leading automaker Toyota Motor Corp. fell 1.74 percent to 3,380 yen, whilst Honda Motor Co. Ltd., closed flat at 2,725 yen. Mitsubishi Motor Corp. lost ground Tuesday retreating 2.54 percent to close at 115 yen at the 3pm bell.
Konica Minolta Holdings Inc., maker of photographic equipment and supplies, also ended the day's trade in negative territory, shedding 1.46 percent to 809 yen. Office automation and equipment makers Ricoh Co. Ltd. and Canon Inc. both posted losses Tuesday, with Ricoh losing 0.51 percent to 1,182 yen and Canon dropping 1.17 percent to 3,360 yen.
Audiovisual maker Sharp Corp. saw gains of 1.71 percent to 1,006 yen, whilst counterpart Pioneer Corp. ended down 3.57 percent at 243 yen.
Defensive shares, often a safe haven in times of economic downturn or uncertainty offered some comfort to investors Tuesday with apparel giant Fast Retailing Co. Ltd., operator of budget high street clothes chain Uniqlo, gaining 0.25 percent to 15,860 yen. Department store operator Marui Group Co. Ltd. also advanced 1.8 percent to 515 yen.
Following a suspected spate of equity financing initiatives in financial sectors, following Mitsubishi UFJ Financial Group's announcement of monumental share-issuance plans last week, both consumer and diversified banking issued lost ground on Tuesday.
Sumitomo Mitsui Financial Group dropped 4.4 per cent to 2,690 yen and Mizuho Financial Group Inc. retreated 1.89 percent to 155 yen.
Mitsubishi UFJ Financial Group Inc. lost 2.76 percent to 468 yen.
Commercial banks followed suit with Sumitomo Trust and Banking Co. Ltd. down 1.75 percent to 448 and Resona Holdings Inc. slumping to 934 yen, a loss of 6.03 percent.
"There's worry about oversupply, worry about the yen's strength and worry about political uncertainty, but at the same time a number of technical factors show that the Nikkei has been oversold, and selling by overseas hedge funds is also likely to quiet down abit," said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.
Trade was light on the Tokyo exchange's First section, with some 1.8 billion shares changing hands, below last week's daily average of 2.1 billion.
Declining stocks outnumbered advancing ones by nearly 4 to 1.
Source: Xinhua
The broader Topix index of all First Section issues on the Tokyo Stock Exchange had its lowest close since April 28, losing 9.49 points to 829.22.
Exporter and tech-shares were hit by the dollar hovering around the 88 yen mark meaning losses for investors as a strong yen cripples profits when repatriated into Japanese currency. Commercial and diversified banking issues also dragged on the market Tuesday, as did cash-strapped Japan Airlines Corp.
Japan Airlines Corp. crashed 8.4 percent to a record low of 87 yen on Tuesday. Investor concern is mounting as to whether the cash-strapped carrier can resolve its impending bankruptcy issues by current employees and retirees accepting a 30 percent cut in pension provisions, before a state-led bailout plan becomes feasible.
As Japan's leading carrier lays out wholesale cost-cutting plans, including axing a number of international and domestic routes as well as downsizing its fleet, investor sentiment was further dashed following news that the trading house Mitsui had sold its entire stake of 11.73 million shares in JAL during the six months to September 30th. A spokesperson for the trading house declined to comment on exactly why they had decided to offload all of their shares in JAL.
Investors retreated from riskier assets today as Japan's Finance Minister Hirohisa said that Japanese demand was weak and monetary policy is the key to fighting deflation, signaling the central bank should do more to stem price declines.
Impacted by a strong yen and antsy trading, exporters like Sony Corp. lost 1.87 points to 2,365 yen. Japan's leading automaker Toyota Motor Corp. fell 1.74 percent to 3,380 yen, whilst Honda Motor Co. Ltd., closed flat at 2,725 yen. Mitsubishi Motor Corp. lost ground Tuesday retreating 2.54 percent to close at 115 yen at the 3pm bell.
Konica Minolta Holdings Inc., maker of photographic equipment and supplies, also ended the day's trade in negative territory, shedding 1.46 percent to 809 yen. Office automation and equipment makers Ricoh Co. Ltd. and Canon Inc. both posted losses Tuesday, with Ricoh losing 0.51 percent to 1,182 yen and Canon dropping 1.17 percent to 3,360 yen.
Audiovisual maker Sharp Corp. saw gains of 1.71 percent to 1,006 yen, whilst counterpart Pioneer Corp. ended down 3.57 percent at 243 yen.
Defensive shares, often a safe haven in times of economic downturn or uncertainty offered some comfort to investors Tuesday with apparel giant Fast Retailing Co. Ltd., operator of budget high street clothes chain Uniqlo, gaining 0.25 percent to 15,860 yen. Department store operator Marui Group Co. Ltd. also advanced 1.8 percent to 515 yen.
Following a suspected spate of equity financing initiatives in financial sectors, following Mitsubishi UFJ Financial Group's announcement of monumental share-issuance plans last week, both consumer and diversified banking issued lost ground on Tuesday.
Sumitomo Mitsui Financial Group dropped 4.4 per cent to 2,690 yen and Mizuho Financial Group Inc. retreated 1.89 percent to 155 yen.
Mitsubishi UFJ Financial Group Inc. lost 2.76 percent to 468 yen.
Commercial banks followed suit with Sumitomo Trust and Banking Co. Ltd. down 1.75 percent to 448 and Resona Holdings Inc. slumping to 934 yen, a loss of 6.03 percent.
"There's worry about oversupply, worry about the yen's strength and worry about political uncertainty, but at the same time a number of technical factors show that the Nikkei has been oversold, and selling by overseas hedge funds is also likely to quiet down abit," said Hiroichi Nishi, general manager at the equity division of Nikko Cordial Securities.
Trade was light on the Tokyo exchange's First section, with some 1.8 billion shares changing hands, below last week's daily average of 2.1 billion.
Declining stocks outnumbered advancing ones by nearly 4 to 1.
Source: Xinhua
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