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Nikkei slides from selling on a rally


Stocks fell slightly Thursday, with early gains wiped out by selling on a rally in the absence of fresh incentives.

The Nikkei 225 average closed down 9.04 points at 15,370.26. On Wednesday, the key market gauge shed 15.86 points.

The Topix fell 0.21 point to end at 1,273.38 after dipping 0.09 point Wednesday.

The TSE got off to a solid start on the heels of overnight gains in U.S. and European stocks thanks to receding concerns over Portuguese bank problems.

Notably, the Dow Jones industrial average rewrote its record high on a closing basis for the first time in some two weeks. The Dow was also helped by brisk earnings from technology giant Intel Corp.

A wide range of issues on the Tokyo bourse attracted purchases, including mainstay export-oriented names, brokers said.

After the initial buying ran its course, however, stock prices trimmed gains as investors began to sell due to lack of fresh incentives to spur buying, brokers said.

The key indexes slipped into negative territory in the afternoon, with selling induced by the yen’s strengthening against other major currencies amid poor performances of Asian equities, brokers said.

Mainstay issues, including major automakers and banks, drew buying interest in early trading, only to erase gains later.

Buying was concentrated all day on small- and medium-cap issues backed up specific positive incentives, such as midsize general contractors, brokers said.

“Selling on a rally weighed down stock prices when the Nikkei reached 15,400. Investors bought stocks at lower price levels but no one purchased at higher levels,” said Hideyuki Ishiguro, senior strategist at Okasan Securities Co.’s investment strategy department.

Given the Dow’s record high and receding signs of overheating in the Tokyo market, the Nikkei could have tested its upside at 15,500, but institutional investors retreated to the sidelines prior to the announcement of key corporate scorecards, which will start in earnest next week, brokers said.

Falling issues outpaced rising ones 903 to 772 in the first section, while 140 issues were unchanged.

Volume increased to 2.285 billion shares from Wednesday’s 1.849 billion.

In the financial sector, megabank groups Sumitomo Mitsui and Mitsubishi UFJ, nonbank lender Aiful and brokerage firm Nomura were downbeat.

Automakers Honda and Mazda were sluggish, along with technologies Toshiba and Hitachi, amid the yen’s appreciation.

On the other hand, Sharp posted handsome gains after Merrill Lynch Japan Securities revised up its investment rating and stock price target on the electronics firm.

Seibu Holding jumped 2.59 percent to extend its winning streak to a fifth session on hopes for an increase in the number of visitors to its main department store in Ikebukuro, Tokyo, which is expected to hold an exhibition of original images of “When Marnie Was There,” the latest movie from Studio Ghibli Inc., market sources said.

Also on the plus side were oil developer Inpex, Japan Tobacco and realtor Mitsubishi Estate.