Nikkei Loses 4%, Worst Weekly Drop in Six Months

Nigel Thomas
06 Apr, 2012
New York City

Stocks in Japan eased and the benchmark Nikkei index fell 0.8%. The index closed down 4% in the week as the yen drives more auto production away from Japan. Prime Minister Noda and three cabinet members have agreed on a broad safety framework to restart two reactors at Ohi nuclear power plant.

[R]8:30 PM Tokyo – Stocks in Japan eased in weak trading and the benchmark Nikkei index fell 0.8%. The index closed down 4% in the week as the yen drives more auto production away from Japan. Prime Minister Noda and three cabinet members have agreed on a broad safety framework to restart two reactors at Ohi nuclear power plant.[/R]

Stocks were under pressure on the last day of trading this week as they have been all week on the renewed debt crisis worries in the euro zone.

The Nikkei 225 Stock Average declined 79.16 to close at 9,688.45 and the broader Topix index decreased 6.86 to 825.71. For the week, the Nikkei index fell 4%, the largest weekly drop in six months.

The yen gained against most currencies and raised the prospect of more auto and electronics production shifting to emerging markets.

The yen closed at 82.26 against one dollar and 108.12 against one euro after the sovereign debt yields rose in Spain, Italy and France. The latest French auction attracted weaker than anticipated interest and Spanish yields on 10-year bonds gained more than 25 basis points.

Stock Movers

Astellas Pharma Inc jumped 105 yen to 3,360 yen after company’s treatment for overactive bladders won the recommendation of advisers to U.S. drug regulatory agency.

Toyota Motor closed down 70 yen to 3,390 yen and Honda Motor Co. dropped 55 yen to 3,010 yen and Nissan Motor Co Ltd decreased 13 yen to 856 yen.

Automakers are likely to send more productions in the local markets as the firmer yen drives production costs higher.

Kobe Steel declined 4 yen to 127 yen after it reported a loss of 20 billion yen for the year ended March, higher than its previous estimate of 10 billion yen.

Kansai Electric Power Company, Inc increased 37 to 1346 yen and Tokyo Electric Power gained 9 yen to 219 yen. Asahi Newspaper report suggested that Prime Minister Yoshihiko Noda and three cabinet members have reached an agreement on the safety standards to permit two reactors at a regional power plant.

Sony Corp slipped 34 yen to 1,634 yen, Panasonic Corp closed down 13 yen at 713 yen and Canon Inc declined 40 yen to 3,845 yen. Nintendo Co. Ltd tumbled 230 yen to 12,130 yen.

Olympus Corp closed down 20 yen to 1,311 yen, Nikon gained 25 yen to 2,450 yen and Fanuc Ltd closed down 330 yen to 14,180 yen. Hitachi Ltd fell 9 yen to 528 yen.

Komatsu Ltd decreased 49 yen to 2,342 yen, Hitachi Construction Machinery Co slipped 67 yen to 1,747 yen and Toyo Engineering Corp closed down 10 yen to 366 yen.

Mitsui O.S.K. Lines, Ltd rose 1 yen to 344 yen, Kawasaki Kisen Kaisha, Ltd increased 4 yen to 186 yen and Nippon Yusen K.K. fell 1 cent to 252 yen.

Fast Retailing Co. soared 130 yen to 17,570 yen and J. Front Retailing Co. Ltd closed up 5 yen to 436 yen.

Mitsubishi UFJ Financial Group fell 4 yen to 402 yen and Sumitomo Mitsui Financial Group dropped 27 yen to 2,623 yen. Nomura Holdings, Inc decreased 6 yen to 356 yen.

Tokyo Tatemono Co., Ltd closed unchanged to 312 yen and Mitsui Fudosan fell 6 yen to 1,504 yen and Sumitomo Realty & Development Co. declined 39 yen to 1,830 yen.

Nippon Steel fell 6 yen to 212 yen and JFE Holdings Inc decreased 1.5% or 27 yen to 1,698 yen.