Tokyo, Nov. 10 (Jiji Press)–Stocks retreated on the Tokyo Stock Exchange Monday, as banks and other high-fliers in the key Nikkei average met with selling after strong employment data failed toboost U.S. stocks on Friday.
Players said the results of Sunday’s general election were within expectations. Prime Minister Junichiro Koizumi’s ruling coalition retained power but with a reduced majority in the House of Representatives, while the main opposition Democratic Party of Japan scored big gains.
“The election results came as no big surprise to the market,” said Kazunori Jinnai, equity general manager at Daiwa Securities SMBC Co. “The outcome failed to provide incentive to boost the market.”
The 225-issue Nikkei average closed down 124.44 points, or 1.2 pct, at 10,504.54. On Friday, the average gained 76.68 points.
The TOPIX index of all first-section issues was down 11.78 points, 1.1 pct, at 1,033.37. It ended 9.58 points higher in the previous session.(MORE)Tokyo Stocks Fall on Wall St. Setback, Banks Sold Heavily
Declining issues outpaced gainers 893 to 516 on the first section, while 117 issues ended flat.
Volume shrank to 939 million shares from Friday’s 1,028 million shares.
Stocks moved on a soft note disheartened by a setback on Wall Street, where investors sought to take profit, finding that October payroll data indicating a healthy recovery in the U.S. job market had already been priced in.
“Amid uncertainties over the course of the U.S. market, some hedge funds cashed in on recent gains, particularly hitting hard on banks,” said Hiroaki Kuramochi, head of the global equities division at Credit Lyonnais Securities (Japan).
The market is seen susceptive to selling from foreign investors, who should play a key role in driving up the Nikkei, ahead of book closings of many hedge funds this month, brokers said.
Trading was thin as a wait-and-mood grew amid lack of fresh trading clue and the market focus was shifting to Japanese economic data due out later this week, including September machinery orders data to be released on Tuesday and July-September gross domestic product on Friday.
“The Nikkei is expected to move in a boxed range as the market needs some more time to complete correction,” said Hiroyuki Nakai, chief strategist at the Tokai Tokyo Research Center. “Machinery orders data and GDP figures are seen unlikely to prompt selling.”(MORE)Tokyo Stocks Fall on Wall St. Setback, Banks Sold Heavily
The megabanks of Mizuho, Sumitomo Mitsui, UFJ and Mitsubishi Tokyo faltered, together with major brokerage houses Nomura, Daiwa and Nikko.
Also under downward pressure were telecom carriers KDDI, NTT and NTT DoCoMo, as well as Internet business investor Softbank.
Steelmakers ceded ground, including Nippon Steel, JFE and Sumitomo Metal Industries.
Among technology powerhouses, Advantest, Tokyo Electron, Hitachi and Toshiba were in negative territory.
In contrast, drug makers like Takeda, Sankyo and Yamanouchi advanced.
Automakers like Toyota, Nissan and Suzuki showed strength.
Construction machinery maker Komatsu was upbeat and was the most heavily traded issue on the TSE’s first section as the company revised up its earnings prospects for the current business year to March 2004.
In index futures trading, the December contract on the Nikkei average finished down 110 points at 10,530 on the Osaka Securities Exchange.END
