Tokyo shares end 1.69pc lower

April 07, 2014 - 9:24:04 am

TOKYO: Tokyo stocks fell 1.69 percent Monday following a heavy sell-off on Wall Street, while the yen strengthened against the dollar, denting exporter shares.

The benchmark Nikkei-225 index lost 254.92 points to finish at 14,808.85, while the Topix index of all first-section issues fell 1.57 percent, or 19.05 points, to 1,196.84.

Daiichi Sankyo's shares bucked the downward trend, jumping 3.30 percent to 1,813 yen as investors cheered news that the Japanese drugmaker was selling its controlling stake in troubled Indian subsidiary Ranbaxy to Sun Pharma as part of a wider $4.0 billion deal.

The deal ends Ranbaxy's ill-fated six-year control by the Japanese company.

"It's about expectations that the mess so far will be sorted out," said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.

The United States, one of Ranbaxy's biggest markets, has slapped import bans on its plants for failing to meet "good manufacturing practices".

Tokyo investors were also awaiting the outcome of the Bank of Japan's policy meeting set to wrap up Tuesday, after the latest US jobs report signalled the Fed was unlikely to speed up tapering of its stimulus drive.

"Japanese stocks are likely to struggle at low levels," said Yoshihiro Okumura, general manager of research at Chibagin Asset Management, pointing to a slow recovery in the US employment market.

The US Labor Department on Friday said jobs growth plodded along at a solid but unspectacular pace in March as the economy appeared to be emerging from one of the coldest winters in recent memory.

The world's largest economy added 192,000 jobs in March -- a shade below analysts' average estimate of 195,000 net new jobs.

The dollar fell after the jobs report to 103.26 yen in New York Friday, well below the 103.88 yen earlier in the day in Tokyo. On Monday it bought 103.12 yen.

A stronger yen is bad for Japanese exporters' profitability.

In share trading, Panasonic tumbled 4.68 percent to 1,162 yen and microchip-equipment maker Tokyo Electron fell 2.60 percent to 6,454 yen.

Honda Motor lost 2.80 percent to 3,571 yen, while Sony slipped 0.30 percent to 1,988 yen.

On Wall Street Friday the three main indexes tumbled after notching up strong gains through the week.

The Nasdaq dropped 2.60 percent, while the Dow sank 0.96 percent and the S&P 500, which saw two record closes in the week, lost 1.25 percent.  (AFP)