Weekly Drop of 3.3% in Nikkei on Yen Strength

Hiruki Nakamura
25 Oct, 2013
New York City

Nikkei in Tokyo eased and closed down 3.3% in the week. The yen gained for the second week in a row. Softbank Corp dropped 5% after Alibaba shelved its plan to list its stock. JFE Holdings lowered earnings outlook and Posco lowered its annual steel sales estimate.

[R]4:30 PM Tokyo – Nikkei in Tokyo eased and closed down 3.3% in the week. The yen gained for the second week in a row. Softbank Corp dropped 5% after Alibaba shelved its plan to list its stock. JFE Holdings lowered earnings outlook and Posco lowered its annual steel sales estimate.[/R]

Market indexes in Tokyo closed lower and declined more than 3% and the yen extended gains for the second week in a row.

Exporters and electronics makers eased for the second day this week on the yen’s strength.

The Nikkei 225 Stock Average declined 398.22 or 2.8% to 14,088.19 and the Topix dropped 25.07 or 2.1% to 1,178.28. For the week, Nikkei 225 plummeted 3.3%.

The yen slipped to 97.12 against one dollar and gained against all major 16 currencies.

Stocks in Review

Toyota Motor Corp slumped 130 yen to 6,200 yen and Honda Motor Co. dropped 45 yen to 3,830 yen. Nissan Motor Co Ltd fell 11 yen to 995 yen.

Sony decreased 21 yen to 1,851 yen.

Softbank Corp declined 370 yen or 4.8% to 7,400 yen after Alibaba Group Holding Ltd. abandoned plans for an initial public offering as investors turned cautious about its controversial shareholding structure.

Fast Retailing Co. plummeted 1,150 yen or 3.5% to 32,150 yen.

JFE Holdings, Inc dropped 4.2% to 2,350 yen after the steel maker reported net sales in the first-half climbed 18.8% to 173 billion yen from 145 billion yen a year ago.

Net income for the period surged to 47.8 billion yen compared to 1.48 billion yen and earnings per share soared 82.81 yen from 2.75 yen a year earlier.

The steel producer lowered its net income forecast for the year to 95 billion yen.

Murata Manufacturing Co., Ltd gained 2.2% to 7,760 yen after the electronic component supplier said preliminary net income in the first-half will be 47 billion yen.

The company lifted its operating profit forecast for the quarter ending in September.

Posco closed unchanged at 7,210 yen after the South Korea-based steel producer revised its outlook and estimated sales for the year may as much as 31 trillion won, down from earlier forecast of 32 trillion won.

The company said profits in the third-quarter slid nearly half to 443 billion won, from previous forecast, as operating profit plunged 47%.

Shin-Etsu Chemical Co Ltd plummeted 4.5% to 5,480 yen after the chemical company forecasted operating profit for the year remains unchanged.