Nikkei Drops 2.8% After Manufacturing Growth Weakens

Hiruki Nakamura
24 Sep, 2015
New York City

Nikkei average plunged 2.8% after Japanese markets reopened after a 3-day holiday. Weakness in New York and Shanghai were compounded by weakening growth profile in manufacturing sector and falling yen. Auto and diesel filter makers led the decliners.

[R]4:30 PM Tokyo – Nikkei average plunged 2.8% after Japanese markets reopened after a 3-day holiday. Weakness in New York and Shanghai were compounded by weakening growth profile in manufacturing sector and falling yen. Auto and diesel filter makers led the decliners.[/R]

Market averages in Tokyo opened lower after a three-day holiday period and caught with international market sentiment in China and in the U.S.

The weak market conditions in Shanghai and in New York drive the sentiment in Tokyo and Nikkei plunged nearly 3%.

Separately, a private survey of manufacturing showed a slowing growth profile in the sector.

The Nikkei Flash Japan Manufacturing Purchasing Managers’ Index declined to 50.9 in September from 51.7 in August when new order growth was at its fastest since January.

New orders growth moderated after export orders declined at the fastest pace in nearly three years.

The Nikkei 225 Stock Average dropped 498.38 or 2.8% to 17,571.83 and the broader Topix index slumped 35.41 or 2.4% to 1,426.97.

The yen strengthened to 119.94 against a dollar.

Automakers led the decliners and Toyota Motor, Nissan, Honda and Suzuki declined between 2% and 4% after investors dumped the sector on the news that Volkswagen manipulated on U.S. diesel vehicle emission tests.

The diesel filter makers Ibiden and NGK Insulators plunged 7%.

Stocks in Review

Fancl Corporation rose 0.3% to 1,558 yen after the cosmetics and nutritional supplements maker reported total sales in August soared 16.5% to 6.67 billion yen from 5.73 billion yen in a same month a year ago.

The company said revenues in cosmetics segment jumped 14.1% to 4.03 billion yen and sales in Nutritional Supplements business surged 24.9% to 2.15 billion yen.

Monex Group, Inc dropped 4.6% to 311 yen after the online securities services provider said operating revenues in August jumped 5.7% to 5.40 billion yen compared to previous month but surged 40% from a year ago month.

Monex said financial expenses in August tumbled 15.2% to 379 million yen from 447 million yen in July and slumped 18.5% from August 2014.

Mitsubishi UFJ Trust and Banking Corporation, the financial services provider and Sofaz Azerbaijan-based state oil fund yesterday made its first real estate investment in retail property of Kirarito Ginza in Tokyo for 52.3 billion yen or $435 million.

Next Co., Ltd slipped 1.4% to 900 yen after the online real estate information provider said revenues in August surged 61.8% to 2.05 billion yen from 1.27 billion in a same month a year ago.

Next said revenues in domestic real estate information services soared 21.7% to 1.42 billion yen and rental and real estate trade jumped 29.8% to 921.3 billion yen.