TOKYO (Thomson Financial) - Japanese shares closed sharply lower on Friday
after investors were unnerved by Toyota Motor's earnings outlook for the current
fiscal year, while a stronger yen dampened sentiment for exporters.
The benchmark index fell more than 300 points at one stage.
Stocks opened marginally lower and the Nikkei gradually widened losses as
investors turned cautious, moving to cash in profits amid the sluggish
performance by Asian stocks and the ongoing reporting season.
"Toyota's poor outcome as well as a rebound by the yen gave traders a cue
for selling," said Yumi Nishimura, manager for equity marketing at Daiwa
Securities SMBC.
On Thursday Toyota Motor reported a record operating profit in fiscal 2007
mirroring strong sales to emerging markets, but warned it was expecting its
first profit fall in nine years in the current fiscal year because of the
adverse impact of a strong yen, higher procurement costs and a slowing U.S.
market.
Shares of Japan's largest automaker declined 3.3 percent to 5,300 yen on
Friday.
The Nikkei 225 Stock Average ended down 287.92 points or 2.1 percent at
13,655.34, off a low of 13,639.99. For the week, the index fell 2.8 percent.
The broader Topix declined 31.19 points or 2.3 percent to 1,341.76, after
falling as low as 1,340.79. It was 2.6 percent lower on the week.
Decliners outpaced gainers 1,402 to 236 with 82 issues unchanged.
Volume rose to 2.01 billion shares from 1.88 billion shares on Thursday.
The dollar was last quoted at 103.24 yen, down from the 103.79-82 levels at
5 p.m. on Thursday and 105.03-06 yen late on Wednesday.
Other export-oriented automakers fell on worries that a stronger yen will
affect their profit margins. Honda Motor shed 3.9 percent to 3,210 yen and
Suzuki Motor was down 3.8 percent at 2,550 yen.
Toshiba gave up earlier gains, turning 0.8 percent lower to 856 yen. The
electronics giant said it aims to more than double its operating profit over the
three years to March 2011 by boosting its semiconductor and power generator
production business and focusing more on offshore markets.
Financial stocks sagged after American International Group announced a
first-quarter loss. General leasing firm Orix tumbled 5.9 percent to 17,250 yen
and major brokerage Daiwa Securities Group shed 3.2 percent to 1,035 yen.
Major non-life insurer Millea Holdings slipped 3.4 percent to 4,330 yen,
while Mitsubishi UFJ Financial Group shed 2.6 percent to 1,088 yen.
Mitsui Chemical lost 4.5 percent to 610 yen after the chemical manufacturer
revised down its net profit for the fiscal year ended March to 24.8 billion yen
on higher purchasing costs of raw materials, compared with a previous projection
of 43 billion yen.
Rival Mitsubishi Chemical Holdings shed 5.2 percent to 698 yen, while fellow
peer Sumitomo Chemical slipped 3.4 percent to 648 yen.
Bucking the trend, Yahoo Japan rose 1.5 percent to 43,900 yen after the
Nikkei newspaper reported that it will form a business partnership with Dwango
that will allow users watching videos on Dwango's video-sharing Web site to buy
related products through Yahoo Japan's online shopping service.
($1 = 103.44 yen)
masami.hachisu@thomsonreuters.com
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