Nikkei ends 2 per cent lower after Toshiba
( 2003-07-30 16:53) (Agencies)
Japan's Nikkei stock average closed two per cent lower on Wednesday as tech issues took a beating after Toshiba Corp announced poor earnings a day after a disappointing outlook from Fujitsu Ltd.
Even Matsushita Electric Industrial, which posted a 27 per cent rise in operating profit for the latest quarter, came under pressure as investors rushed to lock in profits from the consumer electronics giant's recent rally.
The tech-sensitive Nikkei finished down 2.05 per cent at 9,632.66. On Monday it had ended at 9,839.91, its highest close since July 10.
The broader TOPIX index was down 1.45 per cent at 944.31.
Chip and computer conglomerate Fujitsu had already hit market sentiment in late Tuesday trade by raising its half-year loss estimate and investors continued to shy away from most large-cap issues, which had led the Nikkei's rally to the 10,000 mark in the second week of July.
A surprising drop in U.S. consumer confidence did not help and disappointing Japanese industrial output figures released before the start of trade were a further negative factor.
"The market is basically in a correction mode after it tested the 10,000 mark for the Nikkei average and the 1,000-point bar for TOPIX earlier this month. So it's natural to see investors rushing in to grab profits," said Nobuki Goto, investment research manager at Tokio Marine Asset Management.
Matsushita was down 5.37 per cent at 1,410 yen, having risen more than 60 per cent since late April when the Nikkei average hit a two-decade low.
Fujitsu, Japan's largest maker of personal computers and servers, was down 4.39 per cent at 523 yen, adding to its 3.7 per cent loss in the previous session.
Toshiba dropped 8.37 per cent to 460 yen after the electronics conglomerate shocked investors by posting a bigger quarterly loss from a year ago, hurt by falling prices of notebook computers overseas and poor demand for televisions.
"On Fujitsu and Toshiba, their results have put the lack of management at both companies under the spotlight," said Goto.
Others shared the disappointment over Fujitsu.
"Fujitsu always seems to be revising down -- it just leaves you with the feeling of, 'Oh, they've done it again'," said Kazunori Jinnai, general manager at Daiwa Securities SMBC.
Chip testing device maker Advantest Corp, which returned to the black in the April-June quarter, fared better, losing just 0.45 per cent to 6,690 yen.
And several small-to-medium-cap issues, including steelmakers and construction firms, found favor.
Taisei Corp, one of Japan's big four general contractors, jumped 11.42 per cent to 283 yen after Tuesday's news that its parent-based construction orders surged 52.4 per cent in April-June from the same period a year ago.
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