Tokyo shares open lower as stronger yen offsets Wall Street rebound - UPDATE |
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Wed, 21 Nov 2007 01:59
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TOKYO (Thomson Financial) - Tokyo shares opened lower on Wednesday as a stronger yen offset the impact of a rebound on Wall Street overnight.In early morning trade, the US dollar was trading mostly in the upper 109 yen zone, about half a yen lower than levels seen in Tokyo late Tuesday.Shares of export companies were dragged lower by the yen's rise, with the losses outweighing any bargain-hunting interest which might have been inspired by gains on Wall Street overnight.As of 9.45 am (0045 GMT), the Nikkei 225 Stock Average was down 126.01 points or 0.8 percent at 15,085.51, widening its losses from 97.69 points or 0.6 percent at 15,113.83 at opening.The broader Topix index was down 6.79 points or 0.5 percent at 1,462.48 after opening down 5.7 points or 0.4 percent at 1,463.57.'The yen's rise, lower Nikkei futures contract, and pre-opening selling by foreign brokerage offsetWall Street's advance,' said Hiroichi Nishi, equity chief at Nikko Cordial Securities.The Federal Reserve on Tuesday reduced its US economic growth forecast for next year to 1.8-2.5 percent from the previous range of 2.5-2.75 percent, while nudging its inflation forecast lower and pointing to a slight rise in unemployment.In minutes from its October 30-31 meeting, the Fed said the month's rate cut was a 'close call' but at the same time 'most members saw substantial downside risks to the economic outlook and judged that a rate reduction at this meeting would provide valuable additional insurance against an unexpectedly severe weakening in economic activity.'The Dow Jones Industrial Average closed up 51.70 points or 0.40 percent at 13,010.14 after volatile trade, but worries about the credit crunch and the housing market continued to keep a lid on the day's gains.Freddie Mac, the second largest guarantor of home mortgages in the US, yesterday announced a 2 billion US dollar quarterly loss as a result of the sinking housing market.Countrywide Financial Corp fell after an analyst downgraded the stock citing a possible drying-up of liquidity, while Moody's predicted losses in the next two quarters for the country's largest lender.Exporters listed on the Tokyo bourse were sluggish, with Toyota Motor declining 100 yen or 1.6 percent to 6010 yen. Canon Inc eased 50 yen or 0.9 percent to 5440 yen.Bank stocks were firmer, with Sumitomo Mitsui Financial Group up 14,000 yen or 1.7 percent at 817,000 and Mitsubishi UFJ Financial Group, which is due to due to announce its earnings results for the first half to September, was up 9 yen or 1 percent at 944.Mitsubishi Motors Corp was down 2 yen or 1 percent at 200 yen. It was reported earlier that the auto manufacturer plans to set up a factory in Russia to deal with rising demand.(1 US dollar = 109.73 yen)masami.hachisu@thomson.com-hm/ng/hm/ntCOPYRIGHTCopyright Thomson Financial News Limited 2007. All rights reserved.The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
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Tokyo shares open lower as stronger yen offsets Wall Street rebound 