Japanese stocks plummet

By SAPA Time of article published May 7, 2012

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Japanese stocks plummeted Monday, leading Asian stocks down after French and Greek elections cast a shadow over the eurozone's emergence from its debt crisis.

The benchmark Nikkei 225 Stock Average tumbled 261.11 points, or 2.78 per cent, to close at 9,119.14, a three-month low.

The broader Topix index dropped 20.81 points, or 2.62 per cent, to 772.06 after a four-day weekend.

All sectors except aviation lost ground with finance and insurance falling the most. The weakening of the euro to its lowest level since mid-February contributed to the losses.

Eurozone concerns were newly stoked after Sunday elections chose Socialist Francois Hollande as France's next president and saw the two main parties that backed indebted Greece's bailout fail to win a parliamentary majority. The results prompted worries that European austerity measures designed to alleviate the debt crisis would be weakened or rejected.

The election results caused the yen to rise. A higher yen makes Japanese goods more expensive overseas and erodes repatriated earnings for export-oriented Japan.

On currency markets at 3 pm (08:00 SA time), the euro was quoted at 103.69-72 yen, down substantially from 106.19-21 yen late Wednesday in Tokyo before the long holiday weekend and from 104.42-52 yen late Friday in New York.

The dollar was also down against the Japanese currency at 79.82-83 yen after 80.12-16 yen late Wednesday in Tokyo and 79.84-94 yen Friday in New York.

The euro fell against the greenback, trading at 1.2991-94

dollars after 1.3215-3216 dollars late Wednesday in Tokyo and 1.3078-88 dollars late Friday in New York. - Sapa-dpa

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