Japan Stocks Drop as Over 1,000 Topix Members Trade Ex-Dividend

  • Toyota, Sony among shares that went ex-dividend today
  • Yen gains 0.3% versus dollar after sliding on Friday

Japan’s stocks fell, after the Topix index capped its sixth weekly decline in seven weeks, as more than half the companies in the measure traded without the right to receive the next dividend.

Mitsubishi Corp., Hino Motors Ltd., and Fanuc Corp., which went ex-dividend Monday, slumped at least 3.7 percent. Metal producer Mitsui Mining & Smelting Co. declined 4.2 percent after Daiwa Securities Group Inc. cut its target price for the stock. Retail shares led gains among the 33 Topix industry groups, while a gauge of paper producers closed at its lowest since April.

The Topix slipped 1 percent to 1,438.67 at the close in Tokyo on volume 24 percent lower than the 30-day average. The Nikkei 225 Stock Average lost 1.3 percent to 17,645.11. More than 1,000 Topix members traded ex-dividend Monday, equating to a 10.8 point drag on the measure, data compiled by Bloomberg show. Shares held declines after data showed China’s industrial profit fell the most in at least four years.

“Today’s move is mainly because of the ex-dividends,” said Andrew Clarke, director of trading at Hong Kong brokerage Mirabaud Asia Ltd. “Investors are still worried about China and will adjust their positions accordingly.”

The Shanghai Composite Index retreated on Monday as data showed industrial companies’ profits in the world’s second-biggest economy declined the most since at least 2011. Markets in Hong Kong, Taiwan and South Korea were closed for holidays Monday, while mainland China will be shut from Thursday for a week-long break.

Yen Gains

The yen strengthened 0.3 percent to 120.28 per dollar, after sliding 0.4 percent on Friday as Federal Reserve Chair Janet Yellen said the central bank remains on track to raise interest rates in 2015, bolstering the greenback.

E-mini futures on the Standard & Poor’s 500 Index climbed 0.2 percent, reversing a decline of as much as 0.7 percent. The underlying measure dropped less than 0.1 percent on Friday as biotechnology stocks plunged into a bear market amid concerns over drug prices, while Nike Inc. soared after beating analysts’ profit estimates.

House Speaker John Boehner said he will resign from Congress at the end of October, following clashes with conservative members of his Republican conference. While that frees him to schedule a quick vote on a funding bill that will get enough support from Democrats to avoid a government shutdown on Oct. 1, it shifts the risk to December, when the short-term funding expires.

Dividend Payments

More than 1,000 of 1,886 companies in the Topix went ex-dividend today, including Toyota Motor Corp., Mitsubishi Corp. and Sony Corp. The dividend effect accounted for 72 percent of the Topix’s 15.1 point decline today, according to data calculated by Bloomberg.

Trading company Mitsubishi Corp. slid 3.9 percent, while Hino Motors fell 3.8 percent. Fanuc lost 3.7 percent and Toyota slipped 2 percent.

Mitsui Mining & Smelting sank 4.2 percent, the most on the Nikkei 225, after Daiwa Securities cut its target price on the stock by about 30 percent. The brokerage maintained its neutral rating.

The Topix Retail Trade Index rose 1.4 percent. Bicycle-store operator Asahi Co. led gains, jumping 7.1 percent, after reporting a 22 percent increase in half-year profit.

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