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Japanese Traders Follow Sumitomo Lower as Writedowns Loom

  • Sumitomo warns of further impairments; stock dives 8.7%
  • Nickel prices hit 12-year lows due to slowing growth in China
Updated on

Japan’s trading companies fell after Sumitomo Corp. withdrew its full-year earnings forecasts because of a 77 billion yen ($654 million) charge on its Ambatovy nickel project in Madagascar, following a collapse in the price of the metal.

The Tokyo-based trading house, one of Japan’s big five, warned of further impairments on other projects as it assesses the impact of slumping raw material prices, according to a statement Wednesday. Sumitomo had expected net income of 230 billion yen in the year to March and said it will issue new earnings guidance at its third-quarter earnings on Feb. 5.