Connect to share and comment

Tokyo shares plunge on profit taking

PlacardEnlarge
(Globalpost/GlobalPost)

Tokyo stocks fell more than three percent in early trade Monday on profit taking following a rollercoaster session at the end of last week and a 7.3 percent drop the day before.

The Nikkei index at the Tokyo Stock Exchange fell 3.11 percent, or 454.04 points, to 14,158.41 in the first 20 minutes of trading after volatile sessions on Thursday and Friday saw the headline index swing more than 1,000 points.

"Investors' profit-taking movement is continuing as markets in New York and London are closed today, and they might want to watch the currency market," Masahiro Yamaguchi, analyst at Mizuho Securities told AFP.

The London market will be closed for a bank holiday and US markets are shut for Memorial Day.

The Tokyo bourse was going through an adjustment period, Yamaguchi said.

"This is part of reaction to gains in recent weeks in the Tokyo market," he said.

The Nikkei index had been making steady gains until Thursday when the benchmark index plummeted 7.3 percent after disappointing data out of China stoked fears about the world's second-largest economy, a major trade partner with Japan.

That was followed by a turbulent Friday session with the index see-sawing in and out of negative territory for most of the day before ending 0.89 percent higher.

Investors were expected to keep their eyes on the forex market.

The dollar was at 101.11 yen, little changed from 101.14 yen in New York Friday, but weaker than 102.33 yen in Tokyo Friday morning.

The euro was $1.2922 and 130.71 yen, from $1.2936 and 130.82 yen in New York.

Wall Street finished flat on Friday, with the Dow Jones Industrial Average at 15,303.10, the broad-based S&P 500 at 1,649.60 and the tech-rich Nasdaq Composite at 3,459.14.

kh-hih/hg/jah

http://www.globalpost.com/dispatch/news/afp/130526/tokyo-shares-plunge-profit-taking