Tokyo stocks fall by break as Uniqlo operator dives
Tokyo - Tokyo stocks fell Friday morning as retail giant and market heavyweight Fast Retailing plunged more than 11 per cent after forecasting a big decline in annual profit owing to the strong yen.
The firm, which operates the Uniqlo clothing chain, late Thursday estimated net profit in the fiscal year to August would tumble about 45 per cent, adding that warmer-than-expected weather also hit demand for Uniqlo's popular thermal underwear.
Its shares dived 11.36 per cent to 27,025 yen by the break on Friday, helping push Tokyo's benchmark index into the red.
The Nikkei 225 was down 0.56 per cent, or 88.21 points, at 15,661.63, while the broader Topix index of all first-section shares dropped 0.23 per cent, or 2.89 points, to 1,269.75.
A weak lead from Wall Street and the strong yen's negative impact on exporters also hurt market sentiment, analysts said.
The yen hovered around its highest level against the dollar in about 17 months, having erased most of its gains since the Bank of Japan last expanded its asset buying programme in October 2014 The dollar bought 108.61 yen Friday against 108.35 yen in New York, where at on point it fell as low as 107.68 yen.
"We can't see a bottom for the dollar-yen (rate)," Juichi Wako, a senior strategist at Nomura Holdings, told Bloomberg News.
"One possible line in the sand is the 105 level, which is where it traded before the BoJ added to easing." Toyota slumped 1.45 per cent to 5,345 yen, while Sony was off 1.47 per cent at 2,778.5 yen.
Yahoo Japan bucked the downtrend, surging 4.61 per cent to 476 yen after Bloomberg News on Thursday reported that Verizon is considering buying a stake in the Japanese web company from US-based Yahoo.
On Wall Street, the three main Wall Street indexes closed at least 1.0 per cent lower on Thursday, with shares of large banks falling especially hard as the market girds for a tough first-quarter earnings season.