Tokyo - Japanese shares fell, with the Topix index dropping the most in more than a month, after the yen halted a four-day slide against the dollar.
Toppan Printing Co. slumped 6.7 percent, the biggest fall on the Nikkei 225 Stock Average, after announcing a plan to sell 80 billion yen ($780 million) in convertible bonds.
Dai-Ichi Life Insurance Co. slid 3.8 percent as insurers fell the most among the Topix’s 33 industry groups.
Exporters declined after the yen strengthened yesterday, with Toyota Motor Corp., Asia’s largest carmaker, retreating 1.7 percent.
The Topix fell 1.7 percent to 1,240.99 at the close in Tokyo, its biggest slump since October 25.
The Nikkei 225 lost 2.2 percent to 15,407.94 after yesterday closing at the highest level since December 2007.
The yen slid 0.1 percent to 102.56 per dollar, paring yesterday’s 0.4 percent gain.
“Shares are being sold as the yen’s weakening took a break after the Nikkei surpassed this year’s high,” said Shuichi Saito, general manager at Chiba-Gin Asset Management Co.
“But it hasn’t led to panic selling. Only 10 percent of Topix constituents surged more than 10 percent since recent lows on November 8, so there isn’t the overheating we saw in May when shares plunged.”
The Topix has rallied 44 percent this year, poised for its biggest annual gain since 1999.
The index traded at 1.23 times book value, compared with 2.59 for the Standard & Poor’s 500 Index and 1.77 for the Stoxx Europe 600 Index.
The yen has tumbled 14 percent this year, the biggest decline among 10 developed-nation currencies tracked by Bloomberg Correlation- Weighted Indexes.
Insurers Slump
Toppan dropped 6.7 percent to 786 yen after the company announced yesterday it would use proceeds from sale of 80 billion yen in convertible bonds in three and six-year maturities in overseas markets for capital expenditure and debt repayments.
Insurers sank the most of any industry group on the Topix index, led by Dai-Ichi, which plunged 3.8 percent to 1,573 yen.
MS&AD Insurance Group Holdings retreated 3.7 percent to 2,718 yen and T&D Holdings Inc. slid 3.5 percent to 1,330 yen.
Canon Inc., the world’s largest camera maker, dropped 1.9 percent to 3,325 yen after it was downgraded to “underweight” at JPMorgan Chase & Co. by analyst Hisashi Moriyama, who said the company faced a slowdown in camera markets on the increased use of mobile phones.
Stimulus Expectations
Futures on the S&P 500 Index rose 0.1 percent.
The measure yesterday declined 0.3 percent as investors assessed reports on US car and retail sales before jobs data due on December 6, which may provide further clues on when the Federal Reserve will reduce stimulus.
US employers hired 181,000 workers in November after adding 204,000 in the previous month, according to a Bloomberg News survey of economists before the Labor Department report.
Fed officials have said they may reduce the central bank’s $85 billion in monthly bond purchases “in coming months” as the economy improves, according to minutes of their October meeting released last month.
The Fed next meets December 17-18.
“There are deep-rooted concerns about the reduction in monetary stimulus from the US, and investors want to wait to see what the employment data brings at the end of the week,” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc., a unit of Japan’s second-biggest lender by market value.
“The yen, which had been hauling the stock market upwards, has stopped weakening now.” - Bloomberg News