Japan Stocks Down After 3-day Rally

123jump.com Staff
06 Apr, 2010
New York City

Rising yen dragged shippers, electronics and automakers after rising for three days in a row. Index of economic conditions improved in February. U.S. regulators proposed to fine Toyota Motor of $16.4 million.

[R]5:00 AM New York, 7:00 PM Tokyo – Rising yen dragged shippers, electronics and automakers after rising for three days in a row. Index of economic conditions improved in February. U.S. regulators proposed to fine Toyota Motor of $16.4 million.[/R]

Japan’s stock indexes dropped 0.5% dragged by exporters and shipping lines as the yen rose to as much as 93.89 against the U.S. dollar from 94.47 yesterday.

Investors were also unnerved on reports that the U.S. intends to slap the maximum civil penalty on Toyota Motor Corp. for failing to timely notify authorities about the defective brake pedals. U.S. regulators proposed $16.4 million in penalty that can be contested during the next two weeks.

Market losses were limited after a government report showed the measure of economic indicators rose in February.

In Tokyo trading Nikkei 225 Stock Average declined 0.5% or 56.98 to 11,282.32, and the broader Topix Index plunged 0.5% to 990.79.

In the first section of the Tokyo Stock Exchange 10.6 billion shares worth 748 billion yen were traded and in the second section 218 million shares valued at 2.9 billion yen changed hands.

Of the Nikkei 225 index stocks, 67 rose, 145 fell, and 13 were unchanged. West Japan Railway led gainers in the index shares with a rise of 3.9% followed by Sapporo Holdings advancing 2.9%.

Coincident Index Rises in February

Japan’s Cabinet Office reported today that that the composite index of coincident economic indicators rose 0.4 points to 100.7 in February from 100.3 the previous month.

The leading index gained 97.9 in February from 96.9 a month earlier and the lagging index jumped to 85.4 from 84.9 in the period.

U.S. to Fine Toyota $16.4 million

U.S. Transportation Secretary Ray LaHood yesterday announced that Toyota Motor Corp. will be fined $16.38 million, the maximum civil penalty for an automaker under U.S. laws, for knowingly hiding a defect for months from U.S. officials.

The National Highway Traffic Safety Administration said documents obtained from Toyota showed the automaker knew about the sticky pedal defect since September 29, 2009, and failed to notify the agency for at least four months.

Under U.S. regulations, automakers are supposed to notify the NHTSA within five business days if they determine that a safety defect exists.

The Japanese carmaker said it is unlikely to lodge a protest against the penalty.

“We have already taken a number of important steps to improve our communications with regulators and consumers on safety-related matters as part of our strengthened overall commitment to quality assurance,” said Toyota.

Nikkei Movers

Clarion Co Ltd led the decliners in the Nikkei 225 Stock Average with a loss of 9.0% followed by losses in Isuzu Motors Ltd of 4.5%, in Nitto Boseki Co Ltd of 3.0%, in Hitachi Zosen Corporation 2.9% and in Taiyo Yuden Co., Ltd 2.9%.

West Japan Railway Company led gainers in the Nikkei 225 Stock Average with a rise of 3.8% followed by gains in Sapporo Holdings Ltd 2.9%, in Nichirei Corporation of 2.8% and in East Japan Railway Company 2.6%.

Other Movers

Clarion Co Ltd slipped 9.0% to 211.00 yen after the car audio equipment maker was reinitiated “reduce” at Nomura Securities Co.

Honda Motor Co., Ltd dropped 1.4% to 3,330.00 yen after Toyota Motor was slapped with highest civil penalty in the U.S.

Kawasaki Kisen Kaisha, Ltd the shipping line fell 2.1% to 373.00 yen.

Mazda Motor Corporation declined 2.4% to 275.00 yen after the car exporter reported Changan Ford Mazda Automobile Corp. has begun a recall of 7,362 of its cars, China''s quality watchdog said.

Mitsui O.S.K. Lines, Ltd the operator of iron-ore vessels decreased 2.7% to 671.00 yen.

Panasonic Corporation the maker of plasma televisions dropped 2.3% to 1,443.00 yen and Sharp Corporation dropped 2.3% to 1,220.00 yen.