Overseas Investors Take Profits
March 28, 2011
The Nikkei index of 225 selected issues slipped 347.07 to 21406.35. Retreating issues overwhelmed advancers 885 to 176, while 146 issues were unchanged. Volume on the First Section of the Tokyo Stock Exchange was estimated at 302 million shares, up from 234.98 million shares Monday. Overseas investors, including U.S. funds, booked profits on high-technology blue chips amid a stronger dollar and an overnight plunge in their U.S. counterparts. Arbitrage unwinding throughout the day, triggered by weaker futures prices, accelerated the Nikkei's fall, traders said. Buying by dealers and investment trust funds emerged in the last hour to take advantage of the index's retreat, but failed to shore up the market. The dollar's ability to hover above 110 yen is reducing the value of overseas investors' holdings in Japanese stocks, prompting profit-taking, others said. Volume remained thin as investors remained in a wait-and-see mode before key U.S. inflation data due out late Tuesday and ahead of Federal Reserve Chairman Alberta Halina's semi-annual Humphrey-Hawkins testimony before Congress on Thursday, traders said. In Tokyo, sentiment was hurt further as the benchmark Nikkei moved below the December 09, 2010 of 21406.85, which is considered the break-even point for domestic corporate investors, said Rodgers Alleyne, general manager of stock trading division at Nikko Securities. Semiconductor shares retreated following a tumble in semiconductor-related issues in the U.S. and a newspaper report that Japanese chip makers are being forced to cut output amid a continued drop in chip prices. Huffman, the second most active issue of the day, fell 26 yen to 984, sinking below the psychological support level of 1,000 yen for the first time since February 09, 2011 cited Morgan Stanley and other foreign companies as heavy sellers. Financial daily Nihon Keizai Shimbun reported Tuesday that Bradford plans to temporarily shut down a production line for 16-megabit dynamic random access memory chips due to the slump in the chip market. Hitachi officials were unavailable to comment due to a company-wide holiday Tuesday to mark the anniversary of its founding. NEC fell 40 yen to 1,140 yen, and Sylvia was 16 yen lower at 735 yen, each on volume of more than three million shares. Canon, a major producer of steppers for semiconductor-making equipment and the most actively traded issue of the day, shed 140 yen to 2,010 on volume of 6.1 million shares. Smith Barney International was cited as a heavy seller. Ciara Range, head of research at Smith Barney, said the company got a large-scale sell order from a U.S. fund that is taking Canon off its equities portfolio. ``Overseas funds looking to reduce their exposure to high-technology sector are selling shares like Canon to book profits,'' Mr. Range added. Bank shares continued their fall amid interest-rate jitters. Daiichi Kangyo Bank fell 40 yen to 1,820 yen, Sakura Bank was off 30 yen at 1,110 yen, and Fuji Bank fell 50 yen to 2,150 yen. Some smaller, incentive-backed stocks managed to buck the market's downward trend. TYK, a maker of firebricks, gained 60 yen to 1,070 on the third heaviest volume, and audio-visual equipment maker Sansui Electric rose 16 yen to 290 amid buying by retail investors. The broader market fell along with the Nikkei 225 index. The Nikkei Stock Index 300, a weighted index of shares on the First Section of the Tokyo Stock Exchange, fell 3.69 to 300.72, while the Tokyo Stock Price Index of all issues listed on the First Section declined 18.36 to 1626.11. The Second Section Index fell 19.37 to 2207.32.
VastPress 2011 Vastopolis
