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Most Japan Shares Fall; Topix Caps Best Week Since ’09

(Corrects headline and lead to show Topix (TPX) finished week higher.)

Most Japanese shares declined, with the Topix Index capping its biggest weekly advance in more than three years, as the nation’s currency traded near 100 yen to the dollar for a fifth day.

Sony Corp., which gets nearly 70 percent of its revenue from outside Japan, dropped 1.5 percent. Chiyoda Corp., an industrial plant operator, tumbled the most on the Nikkei 225 Stock Average after Australia’s Woodside Petroleum Ltd. scrapped a liquefied natural gas project Chiyoda had bid on. Sharp Corp. jumped 7 percent after the Nikkei newspaper reported that its banks will roll over loans. Nuclear power producers rose the most on the Topix after SMBC Nikko Securities Inc. said there’s increased likelihood operations may resume at some plants halted after the March 2011 nuclear disaster.

Twice as many stocks fell as rose on the Topix, which closed 0.1 percent higher in Tokyo. The measure gained 7.7 percent this week, its biggest weekly surge since December 2009. The Nikkei 225 lost 0.5 percent to 13,485.14, with volume 45 percent greater than its 30-day average.

“These past few days, the yen looked like breaking through to 100 yen to the dollar but just didn’t manage it,” said Juichi Wako, a Tokyo-based senior strategist at Nomura Securities Co., Japan’s biggest brokerage. “Once investors start viewing the 100 yen wall as being quite thick, the stock market will probably take a breather.”

7-Day Surge

The Topix has climbed 59 percent since mid-November as Prime Minister Shinzo Abe and central bank Governor Haruhiko Kuroda pledged to defeat 15 years of deflation. The gauge traded at 1.3 times book value compared with 2.4 for the Standard & Poor’s 500 Index and 1.6 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

The Topix has gained on each of the eight days since April 3, when the BOJ began a meeting that ended with the announcement that it will double the monetary base by the end of 2014 by buying government bonds, its boldest round of quantitative easing.

The Topix’s 14-day Relative Strength Index is now at 75.5, after rising on April 10 above 70, a threshold some traders view as a signal the gauge is overbought. The Topix’s RSI last traded above 70 on March 15, and the gauge fell 2.2 percent the following trading day.

Electricity producers provided the biggest boost to the Topix among the index’s 33 industry groups, as the sector jumped after SMBC Nikko Securities analyst Hidetoshi Shioda said there’s an increased likelihood for the resumption of nuclear power plants that were shut following the March 2011 disaster at a Tokyo Electric Power Co. facility.

Among shares that fell, Takata Corp., which makes safety- gear, extended yesterday’s 9 percent plunge after Japan’s biggest automakers recalled cars because of defective airbags made by the company.

The Nikkei Stock Average Volatility Index declined 1.6 percent to 28.39 today, indicating traders expect a swing of about 8.1 percent on the benchmark gauge over the next 30 days.

To contact the reporters on this story: Anna Kitanaka in Tokyo at akitanaka@bloomberg.net; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net

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

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