Nikkei Slides to a 4-month Low, BoJ on Hold

Nigel Thomas
23 May, 2012
New York City

Stocks in Japan fell sharply after the central bank left its interest rate range and asset purchase program intact but shifted its stance from the monetary policy easing. Exporters and automakers fell. Mazda Motor Corp gained on the prospect of a strategic deal with Fiat SpA.

[R]8:30 PM Tokyo – Stocks in Japan fell sharply after the central bank left its interest rate range and asset purchase program intact but shifted its stance from the monetary policy easing. Exporters and automakers fell. Mazda Motor Corp gained on the prospect of a strategic deal with Fiat SpA.[/R]

Stocks in Tokyo trading fell sharply after the Bank of Japan struck a cautionary tone in its latest statement after the two meeting. The yen firmed and the benchmark index erased gains of last two days and the index is set to close down for the eighth week in a row.

The Nikkei 225 Stock Average shrank 172.69 or 1.9% to 8,556.60 and the broader Topix index slides 11.76 or 1.6% to 721.57.

The yen firmed and closed at 80.11 against a dollar after the Bank of Japan left the asset purchase program intact and interest rate near record low near zero as expected. However, the latest statement from the central bank replaced the earlier sentence that showed its commitment for a forceful monetary easing with an appropriate policy.

In trading, 1.92 billion shares changed hands, higher than 1.52 billion shares volume in Tuesday’s session.

Stock Movers

Kansai Electric Power Company, Inc slipped 12 yen to 1,059 yen and Tokyo Electric Power decreased 6 yen to 157 yen.

Exporters and automakers closed lower after the yen firmed and the rising stress in the euro zone cast a doubt on the growth prospect in the region.

Toyota Motor slumped 15 yen to 3,065 yen and Honda Motor Co. declined 35 yen to 2,567 yen and Nissan Motor Co Ltd slides 10 yen to 766 yen.

Sony Corp shrank 23 yen to 1,096 yen. Panasonic Corp closed down at 17 yen to 523 yen and Canon Inc declined 85 yen to 3,230 yen.

Toshiba decreased 9 yen to 303 yen.

Olympus Corp decreased 32 yen to 1,118 yen, Nikon slumped 67 yen to 2,134 yen and Fanuc Ltd declined 280 yen to 13,250 yen. Hitachi Ltd slipped 13 yen to 460 yen.

Komatsu Ltd plummeted 63 yen to 1,891 yen after Nomura said the company president confirmed at an analyst gathering that the new mining demand was stable and the company has not seen any cancelation of orders.

Hitachi Construction Machinery Co shrank 38 yen to 1,502 yen.

Inpex Corp fell 1.2% to 459,500 yen and Japan Petroleum Exploration Co. slumped 52 yen to 2,978 yen.

Mitsui O.S.K. Lines, Ltd decreased 6 yen to 265 yen; Kawasaki Kisen Kaisha, Ltd unchanged to 137 yen and Nippon Yusen K.K. closed down at 2 yen to 204 yen.

Nippon Electric Glass Co Ltd slides 32 yen to 511 yen and Asahi Glass Co Ltd closed down at 15 yen to 554 yen.

Renesas Electronics Corp declined 9% after Yomiuri newspaper reported that the chip maker is planning to raise 50 billion yen in capital and trim 15% of its workforce.

Fast Retailing Co. slumped 490 yen to 16,710 yen and J. Front Retailing Co. Ltd fell 2 yen to 367 yen.

Mitsubishi UFJ Financial Group decreased 3 yen to 339 yen and Sumitomo Mitsui Financial Group slides 24 yen to 2,310 yen. Nomura Holdings, Inc closed down at 10 yen to 259 yen.

Credit Saison Co Ltd plummeted 49 yen to 1,563 yen.

Tokyo Tatemono Co., Ltd fell 6 yen to 244 yen and Mitsui Fudosan slumped 36 yen to 1,240 yen and Sumitomo Realty & Development Co. declined 58 yen to 1,617 yen.

Nippon Steel decreased 5 yen to 177 yen and JFE Holdings Inc shrank 32 yen to 1,298 yen.