Service Sector Index in Japan Falls

123jump.com Staff
20 Jan, 2009
New York City

Tokyo stocks dropped more than 2% on the latst read on the service industry index showed a decline in November. The weakness in the service sector is the latest confirmation of the declining economy in Japan. Tokyo appoints grandson of the founder Toyoda.

[R]5:00AM New York, 7:00PM Tokyo- Japan service index declines 0.9% to 107.9 in November.[/R]

Stocks in Tokyo declined on a weak read on the latest service index that only confirmed the deepening recession. The new condo sales fell in December also worsened investor sentiment.

In Tokyo trading Nikkei 225 index fell 2.3% or 191.06 to 8,065.79, and the broader Topix Index plunged 1.6% or 12.70 to 805.03.

In the first section of the Tokyo Stock Exchange 8.1 billion shares valued at 510 billion yen were traded and in the second section 75 million shares worth 1 billion yen changed hands.

Of the Nikkei 225 index stocks, 19 rose, 200 declined, and 6 were unchanged. Casio Computer led gainers in the index shares with a rise of 3.3%.

Japan Services Index Declines in November

Ministry of Economy, Trade and Industry reported that the indices of tertiary industry activity fell 0.9% to 107.9 in November in seasonally adjusted terms.

Industries that contributed to the decline include wholesale and retail trade with a fall of 2.6%; finance and insurance of 2.7%; real estate of 1.6%; and transport of 0.9%.

METI said industries that contributed to the increase were information and communications rising 2.7%; electricity, gas, heat supply and water 2%; compound services 5.1%; eating, drinking places and accommodations 1.1%; and learning support 2.2%.

Industries that were unchanged were medical, health care and welfare.

New Condo Offerings Declined 18.2% in December

Nikkei News reported today that Real Estate Economic Institute said the number of new condominiums brought to the market in the Tokyo metropolitan area dropped for the 16th straight month, falling 18.2% to 6,696 units in December from the same period a year earlier.

Gainers & Losers

Casio Computers led advancers in the Nikkei 225 index shares with an increase of 3.3% followed by rises in Showa Denko K.K. of 3.2%, in Shionogi & Co. of 2.4%, in Kirin Holdings of 2.2%, and Mitsubishi UFJ Financial Group of 2.1%.

Automakers also gained. Honda climbed 1.9% and Nissan jumped 0.9%.

Nippon Light Metals led decliners in the Nikkei 225 index shares with a fall of 8.9% followed by losses in Chuo Mitsui Trust of 7.3%, in Softbank Corp. of 7.1%, in Advantest Corp. of 6.6%, and Furukawa Electric of 6.6%.

Commodity stocks fell as metal prices dropped. Gold prices fell $9.4 to $830 per ounce and crude oil prices declined 5% to $34.70 per barrel. Inpex shed 4.8%.

Mazda to Cut Salaries by 10%

Mazda Motor Co. reported yesterday that it will slash managers'' monthly salaries by 10% and suspends operations at its two domestic plants in Western Japan on Fridays in February and March.

The automaker has already cut monthly salaries for its executives by 20%.

Akio Toyoda Named Next Toyota President

Nikkei News reported today that Toyota Motor Corp. has named executive vice president Akio Toyoda, the grandson of the company founder as President Katsuaki Watanabe''s successor.