Japanese Companies Trading In US Extend Losses For Third Session
March 15 2011 - 12:19PM
Dow Jones News
Japanese companies trading in the U.S. took another beating on
Tuesday, as an evolving nuclear crisis struck fear in global
markets.
Traders sold off shares of iconic Japanese corporations like
Toyota Motor Corp. (TM, 72.03.TO) and Sony Corp. (SNE, 6758.TO) for
the third-straight session. Trading was equally bearish on the
iShares MSCI Japan Index Fund (EWJ), an exchange-traded fund that
tracks 324 companies, whose 3.4% decline on Tuesday adds to an 11%
slide since the 9.0 earthquake hit Japan on Friday.
The declines in Japanese funds and companies with American
depository shares follow an 11% plunge in the Nikkei Stock Average
that started a global rout. The Dow Jones Industrial Average was
done 2.1% in late-morning trading.
"We saw people throwing stocks out at that open," Craig Peskin,
co-head of technical analysis research at MF Global, said. "But a
potential nuclear disaster is the wild card."
Toyota dipped 2.7% to $79.46 on the NYSE and shares of Nissan
Motor Co. Ltd. (NSANY, 7201.TO), whose shares trade over the
counter in the U.S., fell 0.5% to $17.74 in recent trading.
Consumer electronics giant Sony Corp.'s shares fell 2.7% to
$30.23 and Kyocera Corp. (KYO, 6971.TO) traded 4.5% lower to $88.88
in New York. Hitachi Ltd. (HIT, 6501.TO) shares fell 6.3% to $46.74
in recent trading.
Japanese financial companies also traded lower, with Mizuho
Financial Group Inc. (MFG, 8411.TO) down 7.1% to $3.34 and Nomura
Holdings Inc. (NMR, 8604.TO) lost 6.7% to trade at $5.08 on NYSE.
Sumitomo Mitsui Financial Group Inc. (SMFG, 8316.TO) fell 1.2% to
$6.43 recently.
With uncertainly guiding trading, strategists said Japanese
share remain at high risk for steeper declines.
"The reason people are selling is that they just don't know,"
said Sam Stovall, chief investment strategist at Standard &
Poor's Equity Research. "The problems that have led share price
have not been resolved, so in the near term prices are definitely
vulnerable."
For the first time since the earthquake, not all Japanese stocks
fell on U.S. exchanges. Honda Motor Co. Ltd. (HMC, 7267.TO) pared
losses and rose 0.3% to $38.26 and Canon Inc. (CAJ, 7751.TO) gained
1.4% to $44.24 recently.
Standard & Poor's Ratings Services said in a report Tuesday
that the earthquake and tsunami are unlikely to have a direct
impact on the credit ratings of most Japanese companies.
-By Chris Dieterich, Dow Jones Newswires; 212-416-2611;
christopher.dieterich@dowjones.com