Tokyo Share Prices Sink To 19-Year Low

September 3, 2002

TOKYO (AFP) - Share prices in Tokyo plunged to a 19-year low as fears over the short term trend for the US market snowballed into panic selling, dealers said.

The Tokyo Stock Exchange's key Nikkei-225 index lost 304.59 points or 3.2 percent to end the day at 9,217.04, its lowest level since September 19, 1983, when it closed at 9,141.25.

"Selling triggered more selling," said Hiroshi Sato, broker at Cosmo Securities Co. Ltd. "We monitored some panic selling from players, who sold shares to secure cash."

The Topix index of all first section shares fell 2.8 percent or 26.12 points to 904.24, its lowest close since December 25, 1984.

Trading was modest, with an estimated 742 million shares changing hands.

"The index was under heavy pressure due to growing uncertainty over the US and Japanese economies," said Hiroishi Nishi, senior market analyst at Nikko Cordial Securities.

"Selling was also accelerated as foreign investors were frustrated over a lack of fresh economic policies by the Japanese government."

The government blamed the hesitant economic recovery in the United States for the local market's woes and ruled out acting to halt the decline in share prices.

"We are not at the moment considering any measures to boost stock prices. It is because the current stumbling in the stockmarket is due to weak US equity markets and stock prices are declining on a global basis," said Finance Minister Masajuro Shiokawa.

"Therefore it is hard for Japan alone to take stock market measures," Shiokawa said.

Nihon Global Securities investment section manager Takayuki Suezaki said there were no positive leads to stem the market's fall, which was exaggerated by slim trading volumes.

"Trading volume may improve after the September 11 anniversary but even then, I am not that optimistic about it," Suezaki said.

Koutaro Aoki, market analyst at Ichiyoshi Securities Co Ltd, said a change in the stance of retail investors, who had been supporting the local market until recently, contributed to the downward momentum.

The latest in a series of corporate scandals involving leading firms, such as Tokyo Electric Power Co. (TEPCO), also hurt sentiment, dealers said.

On Monday, the president and chairman of TEPCO announced their resignations over the suspected cover-up of faults in its nuclear plants from the late 1980s to the early 1990s. TEPCO fell 35 yen to 2,360.

Among hi-tech stocks, Advantest fell 310 yen to 5,390, with Tokyo Electron down 120 at 5,250 while Nikon was off 15 at 991.

Automakers were lower due to a firm yen, with Honda shedding 110 to 4,830, Toyota fell 60 to 2,810 and Nissan was down 12 at 836.

Among semiconductor makers, Fujitsu lost 13 yen to 613, with NEC also down 13 at 627, Hitachi down 18 at 610 and Toshiba off 13 at 387.

Decliners led gainers 1,359 to 80, with 70 stocks unchanged.

http://asia.news.yahoo.com/020903/afp/020903143534top.html