Tokyo stocks resume downward slide

Tokyo stocks resumed their downward slide on Wednesday as an uptick in anxiety over the high oil price and corporate earnings ensured an early end to a nascent rally in the previous session.

The Nikkei 225 average fell 1.7 per cent to close at 10,882.18, wiping out a 0.9 per cent gain on Tuesday that was the first in eight sessions. The Topix index, which contains a broader range of stocks, slipped 1.3 per cent to 1,093.94.

The mood in Tokyo continued to be set primarily by New York, where stocks were pushed lower overnight by oil, mixed earnings signals, and the New York attorney general’s probe into the insurance sector.

Domestic earnings for the six months to September have also been patchy and thus failed to counterbalance the downward drag exerted by Wall Street.

An unconfirmed newspaper report that the Bank of Japan would next week forecast a rise in consumer prices in 2005 had little uplifting effect on shares.

TDK, a leading electronics firm, dropped 2.2 per cent to Y7,620 after a local newspaper reported that sales of the group’s hard disk drive heads were sluggish.

Other technology stocks also slipped as sentiment on the sector chilled, with Advantest, a maker of chip production equipment, falling 0.4 per cent to Y6,890 and rival Tokyo Electron down 2.2 per cent at Y5,380.

Toyota Industries, an affiliate of Toyota Motor, fell 0.4 per cent to Y2,470 even after the machinery maker raised its full year profit forecast by 18 per cent to Y40bn.

Matsuzakaya, a leading department store group, rose 0.2 per cent at Y418 after its net profit for the half year to August rose 460 per cent to Y3.6bn, thanks to an extraordinary gain.