Third Weekly Decline in Japan Stocks, Yen Below 117 Level

Hiruki Nakamura
16 Jan, 2015
New York City

Market indexes in Japan extended losses and for the week the Nikkei index plunged 3.4% and the yen eased 0.3% to 116.55 against one dollar. Market indexes in Japan declined for the third week in a row. Chugai Pharmaceuticals and Sosei Group fell after Swiss franc strengthened.

[R]4:30 PM Tokyo – Market indexes in Japan extended losses and for the week the Nikkei index plunged 3.4% and the yen eased 0.3% to 116.55 against one dollar. Chugai Pharmaceuticals and Sosei Group fell after Swiss franc strengthened.[/R]

Market indexes in Tokyo dropped on growing worries of the rising pressure on the euro after Switzerland abandoned its three-year old pledge to peg Swiss franc to the euro.

Investors were unnerved by a sharp policy reversal at the Swiss National Bank after the central bank abandoned its central tenet of its monetary policy, anchoring the currency to the euro.

The surprise move stunned currency traders and the Swiss franc soared as much as 41% against the euro before subsiding to an increase of 14%.

The Swiss franc appreciated as much as 85.56 centimes to a euro before stabilizing at 1.02 franc.

The Nikkei 225 Stock Average dropped 244.54 or 1.4% to 16,864.16 and the broader Topix index slumped 12.87 or 0.9% to 1,363.73.

For the week, Nikkei 225 plunged 3.4%.

The yen strengthened to 116.51 against one dollar.

Stocks in Review

Amada Co Ltd] gained 1.7% to 1,032 yen after the machine tool maker forecasted net sales for the nine-month period ending in December to jump 16% to 190 billion yen and operating profit for the period to triple to 15 billion yen from a year ago period

Chugai Pharmaceuticals declined 2.5% to 3,150 yen on the worries that the sharp gain in Swiss franc will lift its product sourcing cost.

JSR Corporation declined 5.9% to 1,908 yen after the Nikkei newspaper reported the elastomer and resin product maker may report lower operating profit of 8.07 billion yen from estimated profit of 9.84 billion yen.

Nihon Enterprise Co., Ltd slipped 1.8% to 375 yen after the mobile content provider said net sales in the first-half ending in November soared 15.7% to 2.51 billion yen from 2.17 billion yen a year ago period.

Net income in the period surged 20.3% to 159 million yen compared to 132 million yen in the same period a year ago.

Mazda Motor Corp fell 0.6% to 2,491.50 yen after the vehicle maker signed an agreement with Itochu Corporation to establish new national sales company, Mazda Southern Africa (Pty) Ltd.

Shinko Electric Industries Co., Ltd declined 3.7% to 772 yen after the U.S.-based integrated circuit maker Intel forecasted first-quarter revenue and gross margins may be below market expectation.