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By Taiga Uranaka
TOKYO, March 13 (Reuters) - Japanese shares fell 2 percent on
Thursday, led down by Honda Motor Co Ltd <7267.T> as the dollar's
slide against the yen was seen hurting Japan's export-dependent
corporate profits.
The dollar hit a 12-year low against the yen <JPY=>, falling
below 101.00 yen at one time.
"The yen's gain and concerns about the Japanese economy and
corporate earnings are pulling down the Tokyo market deeper than
Wall Street," said Yoshihiro Ito at Okasan Capital Management.
He said the market is likely to see a volatile session
throughout Thursday, the last day before settlement of index
futures and options. "There are few buyers in such a rough
session, and that is adding to the market's fall," he said.
The benchmark Nikkei average <> ended the morning
session down 2 percent at 12,600.05. The broader TOPIX index
<> fell 2.2 percent to 1,227.16.
Bank shares also dragged the market down, with Japan's three
largest banks erasing hefty gains from the previous session as
investors are demanding to see more than the Fed's latest action
to ease strains in credit markets.
"It's a sign that providing liquidity is not enough," said
Takahiko Murai, general manager of equities at Nozomi Securities.
In a coordinated effort with other central banks, the Fed
plans to expand a lending programme and accept as collateral a
broader base of securities, including mortgage bonds whose value
has dropped with the bursting of the housing bubble.
Honda Motor fell 3.4 percent to 2,965 yen, the biggest drag
on the Nikkei. Toyota Motor Corp <7203.T> lost 2.8 percent to
5,260 yen.
Japan's corporate earnings are also likely to be hit by
record high oil prices and rise in commodities prices.
No.1 lender Mitsubishi UFJ Financial Group <8306.T> shed 6.4
percent to 848 yen, and No.2 Mizuho Financial Group <8411.T> fell
6.5 percent to 386,00 yen. Sumitomo Mitsui Financial Group
<8316.T> lost 6.4 percent to 684,000 yen.
Political deadlock over the appointment of a new governor for
the Bank of Japan added to the market woes.
Opposition lawmakers vetoed Toshiro Muto, the government's
pick for central bank governor, on Wednesday, leaving it with no
successor to Toshihiko Fukui one week before he retires.
"Distrust in Japanese politics is also helping pushing down
the market," said Okasan's Ito.
Some market participants said the tussle over the BOJ
appointment did not matter much since there had been no
expectations in the first place.
"It would have been a surprise to overseas investors if the
BOJ governor had been decided smoothly," said Nozomi's Murai.
DAIICHI SANKYO SOLD
Daiichi Sankyo Co Ltd <4568.T> fell 3.8 percent to 3,050 yen
after U.S. regulators rejected the firm's injectable anaemia
drug Injectafer for the broad treatment of uterine bleeding and
in a surprise move also knocked it back for a narrower
application. []
Shinsei Bank Ltd <8303.T> tumbled 5 percent to 401 yen after
the bank revised down its recurring profit projection for the
business year ending this month to 20 billion yen ($198 million)
from 60 billion yen.
But the bank raised its net profit forecast to 65 billion yen
from 50 billion yen due to the planned sale of its headquarters.
[]
Oil and gas field developer Inpex Holdings Inc <1605.T>
bucked the trend, jumping 4.2 percent to 1.23 milion yen as U.S.
crude oil futures set another intraday record above $110 a barrel
on Wednesday.
Trade was thin, with 826 million shares changing hands on the
Tokyo bourse's first section compared with last week's morning
average of 927 million.
Decliners outpaced advancers by roughly 5 to 1.
($1=101.01 Yen)
(Editing by Michael Watson)
