Japan’s Topix Falls for Fourth Day as Exporters Retreat

Japan’s Topix index fell for a fourth day, posting its biggest drop in more than 11 weeks as the yen gained and exporters and agricultural stocks slid.

Nissan Motor Co. (7201), which counts North America as its biggest market for sales, sank 1.1 percent. Nippon Suisan Kaisha Ltd., which sells seafood, plunged 6.9 percent after reporting profit declined. Japan Steel Works Ltd. sank the most on the Nikkei 225 Stock Average after first-quarter net income plunged. Isuzu Motors Ltd. jumped 3.2 percent as the truckmaker reported profit that beat analyst estimates.

The Topix (TPX) decreased 1 percent to 1,263.53 at the close of trading in Tokyo, the most since May 16. More than four shares fell for each that rose. The Nikkei 225 slid 1 percent to 15,320.31. A private gauge of services trade in China declined to a record low.

“We need to keep a cautious eye on China,” said Kenji Ueno, Tokyo-based senior investment manager at Sompo Japan Nipponkoa Asset Management Co. “China has recovered from its worst earlier in the year, but we can’t say that all is OK across the board.”

The July reading for an index of China’s services industry by HSBC Holdings Plc and Markit Economics came in at 50, the lowest since the series began in November 2005 and down from 53.1 in June.

The yen rose less than 0.1 percent today to 102.52 per dollar, reversing an earlier decline.

Nissan slumped 1.1 percent to 994.5 yen. Honda Motor Co., which gets more than 80 percent of its revenue outside Japan, lost 0.8 percent to 3,520 yen. Panasonic Corp., which gets about half its sales abroad, slid 1.2 percent to 1,228.5 yen.

Futures on the S&P 500 slipped 0.1 percent today. The measure rose yesterday after Portugal announced a bailout for Banco Espirito Santo SA and Berkshire Hathaway Inc. beat earnings estimates.

Earnings Peak

Almost 700 Topix companies report earnings this week, according to data compiled by Bloomberg. Of the 256 businesses that have posted results since July 1 and for which Bloomberg has estimates, 59 percent beat analyst expectations for profit.

Nippon Suisan slumped 6.9 percent to 296 yen, the most since May 23. The fishing company reported a 7.4 percent decline in first-quarter profit to 2.5 billion yen.

Japan Steel Works tumbled 8.6 percent to 403 yen, the most since Feb. 4 and the biggest decline on the Nikkei 225. The company said quarterly net income dropped 60 percent to 491 million yen, while operating profit tumbled 69 percent to 385 million yen. Analysts had expected 1.75 billion yen.

Isuzu gained 3.2 percent to 731.1 yen, the second-biggest advance on the Nikkei 225. First-quarter net income was 21.4 billion yen, beating analyst estimates for 19.3 billion yen.

The Topix climbed 12 percent from this year’s low on April 14 amid optimism about the global economy, signs Japan is weathering a sales-tax increase and speculation the $1.2 trillion state pension fund will buy more local shares. The gauge traded at 1.2 times book value today, compared with 2.7 for the S&P 500 yesterday.

To contact the reporters on this story: Anna Kitanaka in Tokyo at akitanaka@bloomberg.net; Yuko Takeo in Tokyo at ytakeo2@bloomberg.net; Cheng Leng in Tokyo at cleng3@bloomberg.net

To contact the editors responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net Tom Redmond

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