Reuters
Asian Markets
Nikkei falls as euro zone worry sours mood, Sony tumbles
Thu, Feb 07 20:23 PM EST

* Sony dives more than 6 pct * Fujitsu rises on chip unit restructure * Nikkei's 13-week straight gain still in sight By Ayai Tomisawa TOKYO, Feb 8 (Reuters) - Japan's Nikkei share average extended its losses to a second day on Friday as investor sentiment was dented by gloomy comments from the ECB president on Europe's outlook, while Sony Corp tumbled on worse-than-expected quarterly results.

The Nikkei average fell 1.0 percent to 11,247.78 by mid-morning, retreating from a 33-month high of 11,498.42 struck on Wednesday.

But the Nikkei has been up 0.4 percent this week so far, which suggests that it could still mark its 13th straight week of gains, its longest winning streak in 54 years.

Among Friday's losers, Sony Corp led the falls and was the second most-traded stock on the board by turnover, tumbling more than 6 percent after profits in the October-December quarter missed market expectations.

Sony's share price rocketed 42.1 percent in January, catching up with sharp gains in the Nikkei after a lag through November and December.

"The company's stock has been bought because of a weakening yen, but unless it can show that its top line is also growing, it does not look very attractive," said Hajime Nakajima, a deputy general manager at Iwai Cosmo Securities.

Exporters were sold, with Panasonic Corp sliding 3.7 percent and Canon Inc dropping 0.9 percent.

Meanwhile, Fujitsu Ltd bucked the overall market weakness and hit a 10-month high after the company said it would reorganise its microchip business, jumping as much as 8 percent.

Fujitsu and Panasonic Corp said on Thursday they were combining their struggling LSI chip units, which produce highly customised chips used in a range of consumer electronics.

Analysts said that investors stayed on the sidelines on Friday partly because the yen's slide has paused, while some investors are reluctant to take big positions before the three-day weekend. Markets are closed on Monday in Japan for a national holiday.

They added that the mood was soured when European Central Bank President Mario Draghi said while economic activity in the euro area should recover gradually in 2013, there were more negative risks than positive ones. "Investors have traded on Japanese domestic cues related to monetary easing, but worries about the health of the global economy are dominating the mood today," said Nobuhiko Kuramochi, a strategist at Mizuho Securities.

The dollar last traded at 93.70 yen, retreating from 94.06 on Wednesday, the highest since May 2010.

"The market is prone to profit-taking as there need to be more positive catalysts to rise above the recent high," said Hiroichi Nishi, an assistant general manager at SMBC Nikko Securities. "But the massive trading volume posted yesterday suggests that the Japanese market is still in the spotlight where both foreign investors and retail investors are willing to invest." On the Tokyo Stock Exchange's main board, 5.14 billion shares changed hands on Thursday, its second highest volume on record. The broader Topix dropped 0.6 percent to 963.38.


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