Nikkei in Tokyo Falls 1% on Bank Worries, Nissan Guides Higher

Nigel Thomas
27 Jun, 2011
New York City

Stocks in Japan closed lower as investors focused on the passage of Greek austerity measures. Banks declined on the worries that the failure to pass the measures may affect large banks around the world. Automakers gained after positive comments from Nissan.

[R]4:30 PM Tokyo – Stocks in Japan closed lower as investors focused on the passage of Greek austerity measures. Banks declined on the worries that the failure to pass the measures may affect large banks around the world. Automakers gained after positive comments from Nissan.[/R]

Japan benchmark index declined 1% as investors worried that the failure to the passage of Greek austerity measures may impact large banks in Europe and Japan.

Banks were also lower after the international rule setting Basle committee neared the finalization of increase in bank capital requirements and additional capital of as much as 3% in buffer to deal with financial crisis.

The Nikkei 225 Stock Average decreased 1% to 9,578.31 and the broader Topix index fell 0.9% to 825.64.

Tokyo trading volume fell to 1.63 billion shares from the 1.76 billion shares in the previous session. Of the stocks traded, 1,122 increased and 418 decreased.

The yen gained to 80.10 from 80.20 against one dollar and to 114.70 from 114.90 against one euro.

Stock Movers

Banks stocks closed flat at close after recovering from earlier losses at the opening in sympathy with the worries related to the euro-zone.

Mitsubishi UFJ Financial Group traded unchanged at 376 yen and Mizuho Financial Group also traded flat at 128 yen. Sumitomo Mitsui Financial Group increased 0.2% to 2,404 yen.

The yen advanced a fraction against the euro. Euro-sensitive stocks closed lower.

Nintendo declined 1.2% to 14,520 yen and Advantest Corp fell 2% to 1,444 yen. Sony Corp fell decreased 2.1% to 2,033 yen.

Fanuc, the maker of industrial robots, decreased 2.1% to 12,630 yen.

Automakers gained after Nissan made positive comments.

Nissan said in its mid-term business plan that it expects to increase its share in the global auto market by 8% within the next 6 years and also boost its operating profit margin to 8% by the fiscal year ending March 2017.

Honda Motor increased 0.7% to 3,020 yen and Toyota Motor declined 2.3% to 3,210 yen.

Suzuki Motor increased 0.2% to 1,772 yen after the company expanded its business arrangement with the Italy based Fiat.

Tokyo Electric Power Co. increased .6% to 316 yen on the media speculation that the company may sell some of its assets to fund its restructuring costs and pay compensation to nuclear disaster victims.

The company is also expected to resume a new phase of water cooling at its troubled nuclear power plant.

Takashimaya Co increased 1.1% to 536 yen after the third largest department store operator increased its estimate of first half to Aug operating earnings to 6.5 billion yen from 1.5 billion yen.