Mizuho Leads Japan Banks Lower as UBS Cuts to Sell: Tokyo Mover

Mizuho Financial Group Inc. fell the most in almost two years, leading a drop in Japanese bank stocks, after UBS AG analyst Shinichi Ina cut the lender’s rating to sell from neutral, saying recent gains were “overheated.”

The shares declined 5.8 percent, the largest drop since March 15, 2011, to 196 yen at the 3 p.m. close of Tokyo Stock Exchange trading. They are up 25 percent this year.

Ina’s rating on Sumitomo Mitsui Financial Group Inc. was also reduced to neutral from buy, he said in a telephone interview today. The shares fell 3.2 percent to 3,640 yen. The country’s benchmark Topix Index slid 1.3 percent.

“Expected monetary easing driven by Prime Minister Shinzo Abe won’t bolster bank lending rates and drive the megabanks’ net interest profits higher in a short period of time,” Ina said. “The gains in the past 30 days stemmed from an overheated buying spree and now we are seeing profit taking by traders.”

Abe’s pledge to stimulate the economy has spurred a 14 percent jump in the Nikkei 225 Stock Average since elections were held on Dec. 16. The Topix Banks Index has climbed 26 percent since then.

To contact the reporter on this story: Shigeru Sato in Tokyo at ssato10@bloomberg.net

To contact the editor responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net

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