Tokyo Nikkei ends down more than 2%, below 14,000
By Hiroko Nakata
TOKYO, March 2 (Reuters) - Tokyo's benchmark Nikkei average slid more than two percent by the close on Tuesday, ending below the key 14,000-point level for the first time since February 12.
Initial gains on a weaker yen against the dollar evaporated amid continuing pressure from corporate investor sales aimed at unwinding cross-shareholdings before the end of the current business year on March 31, traders said.
The Nikkei 225 average ended 300.69 points or 2.11 percent lower at 13,921.06. March Nikkei futures finished 390 points lower at 13,910.
''The upside was still tightly capped by sales from companies wanting to unwind their cross-shareholdings, so investors just held back from jumping into the market,'' said Masaaki Higashida, deputy general manager at Nomura Securities Co Ltd.
Traders said corporate sales particularly hit the banking sector, as many Japanese companies have traditionally held shares in financial institutions to cement business relations. A number of firms, however, have been trying to sell some of those holdings to help spruce up their balance sheets before March 31.
Banks lost ground across the board, with Sakura Bank down five yen or 1.94 percent at 253, Bank of Tokyo-Mitsubishi down 19 yen or 1.36 percent at 1,381, and Sanwa Bank down 27 yen or 2.31 percent at 1,143.
Investors in general were also cautious due to increasing worries that U.S. stocks may have overshot on the upside. Any sharp correction in the Dow Jones industrial average would damage Tokyo market sentiment, traders said.
Dealers, meanwhile, abandoned a test of the upside before the close, due in part to investor sales in the futures market to hedge cash positions.
''Heavy sell orders were waiting at 14,700 in the futures market, which discouraged dealers who went long at the opening,'' said Kokichi Kumagae, manager at New Japan Securities Co.
A total of 457.37 million shares changed hands on the first section of the Tokyo Stock Exchange, against 420.18 million shares on Monday. |
