Arab Today, arab today tokyo stocks tumble as greece nears eurozone exit
Last Updated : GMT 06:37:39
Arab Today, arab today
Arab Today, arab today

Tokyo stocks tumble as Greece nears eurozone exit

Arab Today, arab today

Arab Today, arab today Tokyo stocks tumble as Greece nears eurozone exit

Tokyo stocks
Tokyo - XINHUA

Tokyo stocks closed sharply lower Monday, with the Nikkei falling 2.08 percent as investor sentiment was soured following Greece voters rejecting austerity measures demanded by its creditors in a referendum on Sunday, taking the debt-plagued country one step closer to exiting the eurozone.

The 225-issue Nikkei Stock Average lost 427.67 points, or 2.08 percent, from Friday to close the day at 20,112.12, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange fell 31.73 points, or 1.92 percent, to finish at 1,620.36.

Local brokers said that fears were now growing that following the referendum that saw a majority of 61 percent of Greeks vote to reject the austerity measures, an exit from the single currency union could be next on the cards for the debt-riddled country. "There's nothing we can do now except lower our risk and wait. The euro was created based on this great dream of a unified Europe, and if they withdraw from the euro then the whole system is going to come into question," said Ayako Sera, a strategist at Sumitomo Mitsui Trust Bank Ltd.

Other analysts noted that while risk to Japan's markets and economy was contained at the moment, the possibility of renewed eurozone debt crisis was entirely possible.

"The referendum result had surprised investors, with polls last week suggesting the "yes" camp was narrowly ahead," said Maki Sawada at Nomura Securities Co.'s investment research department.

"Although exit from the eurozone would likely have a limited effect on Japanese firms because of their limited exposure to Greece, investors remain concerned about the risk of contagion spreading elsewhere in the eurozone," Sawada said.

But as with all cases of market turbulence and economic woes, investors switched from riskier assets like stocks and plowed into safe havens like the yen, driving its value higher versus its counterparts. A strong yen impacts the competitiveness of Japan's exporters overseas and sees profits diminished when repatriated.

The U.S. dollar thus dropped to 122.64 yen from 123.05 yen on Friday, while the euro was also trading lower at 135.57 yen from 136.31 yen logged last week.

However, news that Greek Finance Minister Yanis Varoufakis had announced he was going to step down, as Prime Minister Alexis Tsipras believes bailout talks will go better without him, brightened the market mood moderately in later trade and helped trim some of its losses, but a circumspect mood prevailed, and Europe-linked stocks and exporter-related issues lost ground overall.

Imaging and electronics maker Ricoh lost 2.2 percent to close at 1,242 yen, while Mazda Motor skidded down 2.7 percent to 2,407.

Tosoh a chemical and specialty materials company, tumbled 11 percent to 697 yen, on dilution fears after saying it plans to raise more than 35 billion yen in a new share sale to be spent on capital expenditure. Tosoh fell the most on the Nikkei 225 and marked its biggest decline since March 2011.

Financial issues including banks and other lenders were heavily sold on the first trading day of the week and insurers also comprised major decliners, with Sompo Japan Nipponkoa Holdings dropping 4.7 percent to close at 4,264 yen.

Toshiba finished down 2.7 percent at 412 yen, following reports over the weekend that the maker of everything from laptops and tablets, to semiconductors and transportation automation systems, is likely to post a bigger-than-expected loss of 150 billion yen, owing to the firm's past accounting irregularities.

Trading volume on the main section increased to 2.41 billion shares on Monday, up from Friday's volume of 2.17 billion shares, with declining issues outpacing advancing ones by 1,725 to 118.

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Arab Today, arab today tokyo stocks tumble as greece nears eurozone exit Arab Today, arab today tokyo stocks tumble as greece nears eurozone exit

 



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