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Nikkei Slides as Exporters Drop
15th of July 2006
TOKYO: The Nikkei average slid 1.40% on Monday, impacted by losses in exporters such as Toyota Motor Corp., after U.S. employment data raised fears about an economic slowdown and inflation in the key market for Japanese goods.
The stronger yen contributed to the sell-off. The Japanese currency was at a one-month high against the dollar, increasing concerns that exporters would recognize lower profits from their foreign sales.
"There's concern about inflation in the United States," said Katsuhiko Kodama, senior strategist at Toyo Securities. "It's unclear what will happen (there), and adding to that lack of clarity we've got the gains in the yen... That makes buying difficult", he said. "Right now it's a case of trying to figure out where the selling will stop."
The Nikkei was down 215.03 points at 15,092.58 as of 0050 GMT. The broader TOPIX index was down 1.37% at 1,551.62.
The yen was fetching 113.91 to the dollar, after rising to a one-month high of 113.79 on Friday.
Toyota fell 1.2% to 5,910 yen.
Entertainment and electronics conglomerate Sony Corp slipped 1.6% to 4,910 yen.
Internet and telecoms firm Softbank Corp. dropped 4.6% at 2,195 yen, continuing its losses from of nearly 11% from the previous session.
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