Tokyo Stocks Weak; Production Losses Worries

Nigel Thomas
06 Apr, 2011
New York City

Stocks in Tokyo declined for the second day this week as investors focused on the mounting production losses. Manufacturers are not able to take advantage of the lower yen. Automakers and trading companies were among the most actively traded stocks.

[R]5:00 PM Tokyo – Stocks in Tokyo declined for the second day this week as investors focused on the mounting production losses. Manufacturers are not able to take advantage of the lower yen. Automakers and trading companies were among the most actively traded stocks.[/R]

The benchmark index in Japan declined on the worries that manufacturers are facing difficulties to raise production levels and take advantage of the lower yen. The production losses are increasing across several industries from automakers to electronics makers.

The Nikkei 225 Stock Average declined 31.18 or 0.3% to 9.584.37 and the broader Topix index fell 7.55 or 0.9% to 839.61.

The yen traded lower and fetched as much as 85.52 to a dollar in Tokyo trading.

Resources linked and trading companies declined on profit taking despite the increase in crude oil prices.

Stock Movers

Tokyo Electric Power declined 7% to 337 yen and is down 84% since March 10 closing. The stock came under heavy selling pressure as international investors sold stock despite the news that the company has stopped the leakage of radioactive water at the troubled Fukushima Daiichi nuclear reactor.

Automakers were in focus on the worries that the recent decline in the yen may not help the companies as rolling black out continues to affect production.

Nissan Motor declined 0.4% to 712 yen and Honda Motor fell 1.3% to 2,895 yen. Toyota Motor gained 0.2% to 3,265 yen.

Komatsu fell 0.5% to 2,767 yen, the construction equipment maker reliant on sales in China declined on the worries that tighter lending may affect sales in the country. However, the recent bank tightening measures in the last one year has not slowed down the construction industry.

Oriental Land Co. fell 0.9% to 6,330 yen after a report in Asahi newspaper that the Tokyo Disney Resort reopening may be delayed till May.

Softbank increased 3.3% to 3,315 yen.

Inpex Corp increased 1.2% to 635,000 yen and Mitsui Corp increased 1.3% to 1,479 yen. Marubeni Corp declined 5 yen to 585 yen and Itochu Corp fell 19 yen or 2.2% to 841 yen.

Fast Retailing Company added 1.6% or 170 yen to close at 11,140 yen and Takihyo Co. Ltd fell 1.8% to 367 yen.