Tokyo stocks down 0.87 percent by break
TOKYO–Tokyo stocks fell 0.87 percent on Friday morning, extending the previous day’s losses and following a slump on Wall Street driven by fears the US Federal Reserve will begin belt-tightening later in the year.
The benchmark Nikkei 225 index slipped 113.27 points to 12,901.31 by the break, trimming its initial 1.74 percent drop at the open.
The Topix index of all first-section shares was 1.52 percent, or 16.60 points, lower at 1,075.21.
US shares posted their biggest one-day fall of the year as worries over a likely end to the Federal Reserve’s hefty stimulus measures this year and poor Chinese manufacturing data sent investors running for cover.
The Fed’s $85-billion-a-month bond-buying programme has been credited with helping to prop up equity markets despite lingering uncertainty over the state of the global economy.
“Markets are bracing for the day that they no longer have steroid injections to keep them going,” Credit Agricole said.
One Wall Street the Dow lost nearly 354 points, or 2.3 percent — its largest points fall since November 9, 2011. European bourses also fell sharply.
“US shares had been advancing for so long — almost without a serious pullback — that it was almost about time we finally saw one,” Kenichi Hirano, market adviser at Tachibana Securities, told Dow Jones Newswires.
“Japan stocks, on the other hand, have had most of the hot air already vented, leaving less free fall downside.”
The Tokyo bourse has suffered weeks of volatility since hitting a five-year high last month.
As Japan heads into the final month before July 21 upper house elections investors can expect even more market-friendly rhetoric from the government, said an equity trading director at a foreign brokerage.
The polls are key for Prime Minister Shinzo Abe who is trying to solidify his power base since his landslide election win December.
Sony was down 3.12 percent at 1,950 yen a day after its chief executive said the company’s board was studying a proposed plan to spin off part of its profitable entertainment arm.
Telecom firm SoftBank, which is has offered to buy US wireless carrier Sprint Nextel for $21.6 billion, slipped 2.38 percent to 5,330 yen.
In forex trading, the dollar bought 97.25 yen, compared with 97.27 yen in New York late Thursday.
Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City,Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94