Nikkei, Topix plunge to lowest levels in nearly 5 years

TOKYO, Oct. 6 Kyodo - Tokyo stocks plunged Monday, sending the Nikkei and Topix indexes to the lowest levels in nearly five years as investors remained jittery about the slowing global economy despite measures to quell the ongoing financial turmoil announced by U.S. and European authorities late last week.

The 225-issue Nikkei Stock Average lost 465.05 points, or 4.25 percent, from
Friday to 10,473.09, marking its lowest closing level since February 2004.
The broader Topix index of all First Section issues on the Tokyo Stock Exchange
was down 48.92 points, or 4.67 percent, to 999.05, falling below the 1,000 line
for the first time since December 2003.
Stocks declined in almost all 33 sectors on the TSE, led by sea transport,
securities, and iron and steel issues. The mining sector was the only gainer.
''Concerns about a global economic slowdown are becoming stronger, and this
point shoved off (any optimism coming from) the passage of the financial
bailout bill,'' said Toshikazu Horiuchi, equity strategist at Cosmo Securities
Co.
''The Tokyo market now is faced with a situation that a further plunge in
stocks is unlikely to stop (for now) as there are many investors who have a
pessimistic outlook,'' he said.
Reinforcing the dismal outlook for the United States, the world's largest
economy, were the jobs data released Friday, with the Labor Department saying
that U.S. employers cut 159,000 jobs in the nonfarm sector in September, the
largest decline in five and a half years.
Tokyo stocks kept losing ground as investors continued to fret about the credit
crunch, which also sent the U.S. dollar and the euro down sharply against the
yen.
The weaker dollar and euro also weighed down export-oriented issues as a
slowdown in the U.S. economy especially affects Japan, which relies heavily on
exports to the U.S. market.
The U.S. dollar and the euro were sold heavily for the yen Monday in Tokyo,
briefly sending the dollar to the upper 102 yen level and Europe's single
currency to the upper 139 yen range.
Among exporters, TDK fell 140 yen, or nearly 3 percent, to 4,570 yen, Toyota
Motor shed 180 yen, or over 4 percent, to 3,900 yen, and Sony lost 200 yen, or
nearly 7 percent, to 2,810 yen.
Brokers said Friday's congressional approval of the $700 billion U.S. financial
bailout bill and Saturday's vow by the leaders of Britain, France, Germany and
Italy to work together to stabilize the financial turbulence were not
convincing enough for investors.
Hiroichi Nishi, equities chief at Nikko Cordial Securities Inc., said that the
''bleeding has stopped for now'' after the bill was approved, but that the
market is ''now concerned about its effectiveness'' regarding weathering of
the financial crisis.
The approval came after week-long congressional wrangling after the bill
underwent revisions following the House of Representatives' initial rejection
of the plan.
Reflecting the fallout from the financial turmoil, four major European
countries -- Britain, France, Germany and Italy -- held an emergency summit in
Paris on Saturday and vowed to work together to stabilize the global financial
markets.
They also announced plans, including setting up within the European Union a
body to supervise banks to stem the spread of the financial turmoil in Europe.
On the First Section, declining issues outnumbered advancing ones 1,594 to 95,
with 23 others remaining unchanged.
Banking issues suffered steep losses, with value leader Mitsubishi UFJ
Financial Group shedding 82 yen, or over 9 percent, to 806 yen, and Mizuho
Financial Group losing 34,000 yen, or nearly 8 percent, to 402,000 yen.
Other financials were also lackluster. Nomura Holdings fell 104 yen, or nearly
8 percent, to 1,241 yen.
But there were a few bright spots, such as convenience store chain operator
Lawson. It advanced 10 yen, or 0.19 percent, to 5,230 yen, after announcing it
has revised upward its estimate for group net profit for fiscal 2008 to 23.9
billion yen from the initial forecast of 20.8 billion yen.
Trading volume on the main section came to 2,566.95 million shares, up from
Friday's 2,345.66 million.
Nippon Steel was the day's volume leader, shedding 27 yen, or nearly 8 percent,
to 319 yen, as iron and steel issues are often affected by economic swings.
The TSE's Second Section index was down 127.51 points, or 5.67 percent, to
2,121.15 on a volume of 111.46 million shares. On the Osaka Securities
Exchange, the near-term December Nikkei 225 index futures contract was down 510
points to 10,450.