Posted on 09/10/2001 12:20:02 AM PDT by Revel
Monday September 10, 2:18 am Eastern Time
Nikkei marks new 17-yr closing low; banks tumble
(UPDATE: Updates to close)
TOKYO, Sept 10 (Reuters) - Tokyo stocks stumbled to a fresh 17-year closing low on Monday as earnings woes spread from the high-tech sector into traditional manufacturers due to the economy's prolonged slump.
Also weighing on the market were Asahi Bank Ltd and Daiwa Bank Ltd , which lost heavily because investors were unconvinced about benefits of a potential merger between the two lenders.
``Non-tech issues are overtaking high techs to lead the Tokyo market lower, making Tokyo's slide broad-based,'' said Masatoshi Sato, senior strategist at Mizuho Investors Securities.
``Sentiment is getting worse, although this may be an unavoidable phase for this market to go through before hitting a firm floor.''
The benchmark Nikkei average ended down 321.10 points or 3.05 percent at 10,195.69, a level not seen since August 1984. The capital-weighted TOPIX index (^TOPX - news) fell 24.85 points or 2.30 percent to 1,055.98.
Asahi Bank lost 19.25 percent to 130 yen and Daiwa Bank shed 13.58 percent to 140 yen.
On Friday, Asahi asked Osaka-based Daiwa Bank to consider a merger under a holding company structure, but traders said a lack of clarity on the issue had deterred interest.
``For Asahi, this looks like a step in the right direction, but details are sparse and we're still not sure Daiwa would agree,'' said Tatsuyuki Kawasaki, director of equities at Kaneyama Securities.
Major steelmakers fell sharply after slashing their earnings forecast on Friday.
Japan's second-largest steelmaker, NKK Corp , tumbled 7.14 percent to 91 yen after the company revised its group net forecast for the year to next March to a loss of 15 billion yen from a five billion yen profit.
``It seems that Tokyo stocks have fallen to low enough levels. But this downward momentum may not cease until we see the Nikkei dipping below the 10,000 threshold,'' said Shuji Terao, senior portfolio manager at Mitsui Marine Asset Management.
Maybe they'll put pennies behind the fuses, like in the old days!
Would not want to be long the Dow this month, or next.
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