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Topix Drops to Extend Weekly Decline on Yen, Steelmakers

Japanese shares fell, with the Topix (TPX) index extending its weekly loss, as the yen headed for a second day of gains and steel companies slid.

Toyota Motor Corp., which gets three-quarters of sales overseas, was the biggest drag on the Topix, slipping 0.7 percent. Nisshin Steel Co. dropped 3.5 percent for the second-largest decline on the Nikkei 225 Stock Average. Mitsui OSK Lines Ltd. slid 1.8 percent after the shipper’s share-price target was cut at Barclays Plc. A Topix gauge tracking drugmakers added 0.7 percent for the biggest increase among the broader measure’s groups.

The Topix lost 0.4 percent to 1,280.74 at the close of trading in Tokyo, with all but five of 33 industry groups retreating. The gauge is poised for a 0.4 percent decline this week. The Nikkei 225 sank 0.5 percent today to 15,459.86. The yen rose 0.1 percent to 103.76 per dollar after gaining 0.2 percent yesterday.

“There’s no reason to buy,” said Mitsushige Akino, executive officer at Ichiyoshi Asset Management Co. in Tokyo. “Given the uncertainty about whether corporate earnings can increase from here, we can’t buy the Nikkei 225 if it climbs above 15,500.”

Futures on the Standard & Poor’s 500 Index slid 0.1 percent. The underlying equity gauge rose 0.1 point in New York yesterday amid thin trading after closing above 2,000 the previous day for the first time.

The Japanese gauge traded at 1.2 times book value today, compared with 2.7 for the S&P 500 and 1.9 for the Stoxx Europe 600 Index yesterday. Volume on the Topix was about 3.8 percent higher than the 30-day average today.

Toyota, Nikon

Some exporters fell as the yen advanced. Toyota lost 0.7 percent to 5,935 yen. Nikon Corp., the world’s No. 2 camera maker, decreased 0.4 percent to 1,499.5 yen. Japan Tobacco Inc., which gets more than half its sales abroad, slid 0.8 percent to 3,581 yen, capping a third day of declines.

The Topix Iron & Steel Index sank 1.4 percent, the biggest drop among the industry groups. Nisshin Steel fell 3.5 percent to 1,117 yen. Nippon Steel & Sumitomo Metal Corp., the nation’s largest maker of the alloy, slipped 1.9 percent to 298.8 yen while JFE Holdings Inc., the second-biggest, retreated 1.4 percent to 2,116.5 yen.

Mitsui OSK (9104) declined 1.8 percent to 380 yen after Japan’s No. 2 shipper’s price target was cut to 370 yen from 430 yen at Barclays, which kept its equalweight rating on the shares. Kawasaki Kisen Kaisha Ltd., the third-biggest, added 0.8 percent to 253 yen after the brokerage raised its outlook for the stock to 290 yen from 270 yen.

Data on the nation’s inflation and employment are due tomorrow. Consumer prices excluding fresh food will probably rise 3.3 percent in July from a year earlier, according to the median estimate of economists surveyed by Bloomberg, holding steady from the month before. The jobless rate is projected to be unchanged at 3.7 percent.

To contact the reporters on this story: Cheng Leng in Tokyo at cleng3@bloomberg.net; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net; Anna Kitanaka in Tokyo at akitanaka@bloomberg.net

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

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