Japanese Market Sharply Lower; Plunges 4%

The Japanese stock market is trading sharply lower on Monday, giving up all the gains in the previous two sessions. The benchmark S&P/ASX 200 is plunging more than 4 percent to below the 38,200 level, following the mixed cues from Wall Street on Friday, with losses across most sectors lead by index heavyweights, exporters and technology stocks. Financial stocks were the only bright spot.

The benchmark Nikkei 225 Index is down 1,639.64 or 4.12 percent at 38,189.92, after hitting a low of 37,960.09 earlier. Japanese shares ended sharply higher on Friday.

Market heavyweight SoftBank Group is losing more than 6 percent and Uniqlo operator Fast Retailing is declining more than 2 percent. Among automakers, Honda is declining more than 6 percent, while Toyota is slipping almost 7 percent.

In the tech space, Screen Holdings is losing almost 6 percent, Advantest is declining more than 5 percent and Tokyo Electron is slipping more than 6 percent.

In the banking sector, Sumitomo Mitsui Financial is gaining more than 4 percent, Mitsubishi UFJ Financial is adding more than 2 percent and Mizuho Financial is surging more than 5 percent each.

The major exporters are mostly lower. Canon is losing almost 6 percent, Mitsubishi Electric is slipping more than 5 percent, Panasonic is declining more than 3 percent and Sony is down more than 3 percent.

Among other major losers, Isetan Mitsukoshi is plummeting 11.5 percent and Lasertec is plunging more than 9 percent, while J. Front Retailing, Sumitomo Realty & Development and Mitsui Fudosan are sliding almost 9 percent each. Taiyo Yuden and Mitsubishi Estate are slipping more than 8 percent each, while Tokyo Electric Power and Tokyo Tatemono Subaru are losing almost 8 percent each. TDK, Suzuki Motor and Nomura Holdings are declining more than 7 percent each, while Mazda Motor and Nitto Denko is down almost 7 percent each.

Conversely, Resona Holdings is surging almost 6 percent and Concordia Financial Group is gaining more than 3 percent, while Chiba Bank, DeNA and Shizuoka Financial are adding almost 3 percent each.

In economic news, Industrial production in Japan was down a seasonally adjusted 3.3 percent on month in August, the Ministry of Economy, Trade and Industry said on Monday. That missed expectations for a decline of 0.5 percent following the 3.1 percent increase in July. On a yearly basis, output slumped 4.9 percent. According to the METI’s forecast of industrial production, output is expected to rise 2.0 percent in September and 6.1 percent in October.

Meanwhile, the total value of retail sales in Japan was up a seasonally adjusted 0.8 percent on month in August, the Ministry of Economy, Trade and Industry said on Monday – coming in at 13.772 trillion yen. That’s up from 0.2 percent in July and 0.6 percent in June. On a yearly basis, retail sales advanced 2.8 percent – beating forecasts for 2.6 percent and up from 2.7 percent in the previous month

In the currency market, the U.S. dollar is trading in the lower 142 yen-range on Monday.

On Wall Street, stocks turned in a mixed performance during trading on Friday, with the major averages ending the day on opposite sides of the unchanged line. The Dow rose to a new record closing high, but the Nasdaq and the S&P 500 gave back ground.

While the Dow pulled back well off its highs of the session, the blue chip index still ended the day up 137.89 points or 0.3 percent at 42,313.00. The Nasdaq fell 70.70 points or 0.4 percent to 18,119.59 and the S&P 500 edged down 7.20 points or 0.1 percent to 5,738.17.

Meanwhile, the major European markets moved to the upside on the day. While the German DAX Index jumped by 1.2 percent, the French CAC 40 Index climbed by 0.6 percent and the U.K.’s FTSE 100 Index rose by 0.4 percent.

Crude oil prices closed higher on Friday as additional stimulus measures from the Chinese government eased concerns about the outlook for demand. West Texas Intermediate Crude oil futures for November added $0.51 or at $68.18 a barrel.

Market Analysis