Japan’s Topix Falls to Lowest in Two Years Amid Global Growth Concern

Japan’s Topix index dropped for a fourth day, falling to its lowest level in more than two years, as exporters slid on concern global economic growth is slowing.

Toyota Motor Corp., the world’s biggest automaker, dropped 2.5 percent. Fanuc Corp., which gets 75 percent of its sales outside of Japan, fell 4.1 percent. Hino Motors Ltd. slumped 4.8 percent after Deutsche Bank AG. cut its investment rating on the truckmaker.

The Topix slipped 1.2 percent to 742.84 at the 3 p.m. close of trading in Tokyo, falling to the lowest since March 2009. The gauge lost 12 percent this month amid concern that U.S. growth is sputtering and Europe’s debt crisis will damage the banking system, damping demand in two of Japan’s biggest export markets.

“The outlook for the global economy is so cloudy, and investors are substantially cautious,” said Masahiko Sato, an equity market analyst at Nomura Holdings Inc. “Investors are concerned that the global economy won’t end with it just falling into a soft patch, but will collapse into a recession and there’ll be a huge decline in demand.”

The Nikkei 225 (NKY) Stock Average slipped 1 percent to 8,628.13 today, erasing earlier gains of as much as 0.4 percent. The exporter-heavy index advanced briefly after Japanese Finance Minister Yoshihiko Noda said today he’s prepared to take decisive steps to curb the yen’s appreciation after it rose last week to a post-World War II high against the dollar.

U.S. Economy

Futures on the Standard & Poor’s 500 Index dropped 0.3 today. The index fell 1.5 percent on Aug. 19 in New York as the cheapest price-earnings ratios since 2009 failed to lure investors amid concern the global economy is weakening.

Japanese shares dropped on concern the recovery in the world’s biggest economy is weakening. A report on Aug. 24 may show orders for U.S. durable goods excluding transportation fell 0.5 percent in July, according to the median forecast of economists surveyed by Bloomberg News. The drop would be the biggest since February.

Concern about Europe’s sovereign-debt crisis also grew after German Chancellor Angela Merkel said she’ll resist pressure to back common euro-area bonds as a means to solve the region’s debt crisis. Investor calls for euro bonds intensified last week as European stocks plunged to their lowest level in more than two years.

Exporters Fall

Toyota fell 2.5 percent to 2,700 yen. Fanuc, Japan’s biggest maker of industrial robots, slid 4.1 percent to 11,650 yen. Hino Motors Ltd. slumped 4.8 percent to 381 yen after Deutsche Bank lowered its rating on the stock to “hold” from “buy.”

Trading volume was below average ahead of a meeting of central bankers this week in Jackson Hole, Wyoming. Record-low yields on U.S. Treasuries show traders expect Federal Reserve Chairman Ben S. Bernanke to signal a third round of asset purchases, so-called quantitative easing, to boost the economy.

The value of shares traded on the first section of the Tokyo Stock Exchange was 1.2 trillion yen, about 14 percent less than this year’s daily average of 1.4 trillion yen.

Japanese stocks fell even after Finance Minister Noda said he’s prepared to sell the yen to curb its appreciation. The currency slid against the dollar after Noda’s comments, declining to 76.74 as of 3:08 p.m. in Tokyo from 76.55 on Aug. 19 in New York.

Among stocks that rose, Chubu Electric Power Co., Japan’s third-largest utility, advanced 0.4 percent to 1,459 yen after the Yomiuri newspaper reported the Japan Bank for International Cooperation may provide 100 billion yen ($1.3 billion) of emergency loans to the company this month. The utility, which shut its Hamaoka nuclear power plant to strengthen its tsunami defenses, forecasts a 140 billion yen loss this fiscal year.

To contact the reporters on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net; Satoshi Kawano in Tokyo at skawano1@bloomberg.net.

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

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