Japan Stocks Fall 5%, Exoprters Fall

123jump.com Staff
13 Nov, 2008
New York City

Stocks in Japan and in Asia fell more than 5% as the U.S. lawmakers struggle to decide the fate of General Motors. The largest U.S. electronics retailer Best Buy issued grim holiday sales outlook. Exporters in Japan fell. Currencies in the region declined more than 2%.

[R]5:00AM New York, 7:00PM Tokyo - Japan’s wholesale inflation slows to 4.8% in October. Stocks in Japan and Asia fell more than 5% and currencies declined in the region against dollar.[/R]

Japan market averages fell by more than 5% on a profit warning from the largest U.S. consumer electronics retailer Best Buy. The retailer forecasted grim outlook for the holiday season knocking the hopes of higher sales for Japanese exports.

In Tokyo trading Nikkei 225 fell 5.3% or 456.87 to 8,238.64, and the broader Topix Index slid 4.3% or 37.70 to 837.53.

In the first section of the Tokyo Stock Exchange 21 billion shares worth 1.7 trillion yen were traded and in the second section 306 million shares valued at 2.7 billion yen changed hands.

Of the Nikkei 225 index stocks 10 rose, 212 declined, and 3 were unchanged. Shimizu Corp. led gainers in the index shares with a rise of 13.4% followed by Obayashi Corp rising 10%.
Asian Currencies, Markets Fall

Asian markets fell sharply on the back of weakness in New York trading. Australia, Hong Kong, Japan and India dropped at least 5%.

Asian currencies declined on the continued uncertainties in the U.S. Indonesian rupiah dropped 2% to 11,800 reaching the low reached seven years ago. Korean won declined 2.2% to 1,391.50 and Thai baht fell to 35.019. Singapore dollar declined to S$1.512 and Australian dollar to 63.88 U.S. cents. Rupee in India dropped 2.3% to 49.30 at close and has lost now 20% for the year.

Producer Prices Ease to 4.8% in October

The Bank of Japan reported today that the domestic corporate goods prices index eased to 4.8% in October after rising 6.8% the previous month.

The export price index declined 8.7% from a drop of 1.3% in September, while the import price index rose 3.3% from 19.9% the previous month.

New Condo Offerings Fall 26% in October

Nikkei News reported today that Real Estate Economic Institute says the number of new condominiums in the Tokyo metropolitan area declined 26% to 4,240 units in October from the prior year period.

U.S. Retailer Best Buy Issues Profit Warning

The largest U.S. consumer electronics retailer Best Buy reported comparable store sales declined 7.6% and U.S. sales dropped 7.8% in October as the consumer environment fell the most since 42 years.

The company forecasts that revenue in the peak period for the November to February period will fall between 5% and 15%.

Best Buy earnings statement noted, “The uncertainty regarding future consumer spending has limited the company''s ability to project revenue for the critical holiday shopping season and the balance of the fiscal year.”

Also earnings for the year through February 2009 will decline to between $2.30 and $2.90 a share.

Gainers & Losers

Shimizu Corp. led advancers in the Nikkei 225 index shares with a rise of 13.4% followed by increases in Obayashi Corp. of 10%, in Kajima Corp. of 8%, in East Japan Railway of 3.7%, and Nippon Paper Group of 3.6%.

Nippon Paper Group rose after crude oil prices for December delivery plunged 5.3% to $56.16 per barrel.

Softbank Corp. led decliners in the Nikkei 225 index shares with a fall of 13.8% followed by losses in Japan Steel Work of 13.3%, in Chiyoda Corp. of 13.2%, in Mitsumi Electric Co. of 13%, and Konica Minolta Holdings of 11.9%.

Consumer retail companies slid on a profit warning from Best Buy. Nikon Corp. plunged 10.7%.

Financial stocks plummeted after Mizuho Financial Group reported today that the group’s net profit for the fiscal first half plunged 71% on rising losses from risky loans and securitized investment products.

Sumitomo Trust & Banking shed 9.7% and Fukuoka Financial lost 9.4%.