(Adds comment, stocks, details)
By Aiko Hayashi
TOKYO, April 14 (Reuters) - The Nikkei stock average fell 2.8
percent on Monday, with exporters such as Canon Inc <7751.T> hit
by a stronger yen and further evidence the United States may be
in recession, while KDDI Corp <9433.T> tumbled after cutting its
profit forecast.
U.S. stocks slumped on Friday after surprisingly weak
earnings from General Electric Co <GE.N> and data showing
consumer sentiment at a 26-year low fed fears the economy is in
recession.
"General Electric's results must be evidence of an eroding
U.S. economy," said Fujio Ando, a senior managing director at
Chibagin Asset Management.
"It was an earlier sign than expected of a non-financial
company's report being hurt by the credit crisis, although I had
expected it from European and U.S. financial institutions... By
association, investors have become jittery ahead of Japanese
corporate earnings season."
The benchmark Nikkei average <> finished the morning
down 373.93 points at 12,949.80. It finished Friday up 2.9
percent, ending a three-day losing streak, and gained 0.2 percent
for the week.
The broader TOPIX index <> declined 2.5 percent or 31.68
points to 1,246.94.
The dollar rose as high as 101.97 yen <JPY=> earlier, up from
around 101.00 yen in late New York trade, but later trimmed its
gains to stand at 101.17 yen.
Market analysts said nothing substantial came out of the
Group of Seven finance heads meeting at the weekend so this was
having very little impact on the market.
The world finance leaders concluded their meeting by
announcing a new plan to clean up banks and fresh resolve to rein
in foreign exchange markets, but little hope that the credit
crisis was nearing an end. []
GE posted an unexpected 6 percent drop in first-quarter
profit on Friday, the biggest shock yet to a U.S. industrial
bellwether from the credit crisis and the latest sign the U.S.
economy may be in a recession. []
EXPORTERS HIT
One bright spot was Takashimaya Co Ltd <8233.T> after the
department store operator said its operating profit rose 11.3
percent to 37.7 billion yen ($372 million) for the year just
ended, boosted by increased sales at a revamped store in Tokyo
and the solid performance of its Singapore operation.
Takashimaya climbed 3.8 percent to 1,225 yen.
But Japan's exporter shares lost ground as recession fears
loom in the U.S. market. Canon dropped 3.9 percent to 4,660 yen
and Sony Corp <6758.T> lost 4 percent to 4,070 yen, while Honda
Motor Co Ltd <7267.T> gave up 3.3 percent to 2,805 yen.
Shares of KDDI skidded 6.9 percent to 647,000 yen after
Japan's No. 2 phone company cut its annual operating profit
forecast by 3.4 percent citing higher marketing costs due to
better-than-expected sales of its mobile phones. []
Financial shares slid. Top lender Mitsubishi UFJ Financial
Group <8306.T> declined 3.4 percent to 930 yen and Sumitomo
Mitsui Financial Group <8316.T>, the third-biggest bank, slipped
4 percent to 703,000 yen. But No. 2 Mizuho Financial Group
<8411.T> added 0.7 percent to 410,000 yen.
Eisai Co Ltd <4523.T> shed 3.9 percent to 3,430 yen after
Japan's fourth-largest drug maker said on Friday it would drop
development of E2007 for Parkinson's disease but continue its
development for neuropathic pain and epilepsy. [].
Trade slowed on the Tokyo exchange's first section, with 694
million shares changing hands, compared with last week's morning
average of 840 million.
Declining stocks outnumbered advancers by nearly 11 to 1.
(Reporting by Aiko Hayashi; Editing by Hugh Lawson)
