Nikkei sinks to lowest level in three weeks

The Nikkei sunk to its lowest level in nearly three weeks on Thursday as fears over the effect of rising crude oil prices put investors on the back foot, sending shares of exporters such as carmakers lower.

The Nikkei finished 0.8 per cent lower at 11,775.50, its lowest level since February 28th, while the broader-based Topix was off 0.5 per cent at 1,192.28.

Despite the Nikkei‘s second near 100-point fall in the last six sessions, the index has managed to hold onto more than 50 per cent of the gains it made in its eight-day winning run at the start of March.

Concern about exporters, coupled with mild worries about the condition of the US car market after GM‘s warning knocked domestic carmakers.

Nissan was down 1.1 per cent at Y1,095, Honda lost 1.5 per cent at Y5,400 and Toyota shed 1.7 per cent at Y4,000.

Nevertheless, some traders said they were surprised to see the declines as problems at US carmakers indicated upside of Japanese companies. Furthermore, data earlier in March suggested Japanese makers were increasing their market share in the world‘s largest economy.

Other export-oriented stocks were also weaker on concern about the effect of rising crude prices on consumer spending. TDK, the technology group, was down 1.3 per cent at Y7,470.

But selected energy-related stocks enjoyed further gains, with oil refiner AOC Holdings rising 5.6 per cent at Y1,660, Kanto Gas and Development 5.9 per cent higher at Y716 and Inpex gaining 3.2 per cent at Y587,000.

Fuji Television climbed for a second consecutive session, up 12.3 per cent to Y284,000 after reports said Livedoor, the internet start-up, could now turn its attention to taking over the broadcaster. Livedoor appears to have won the battle to acquire Nippon Broadcasting System in the face of opposition from its shareholder Fuji. A victory for Livedoor over NBS would give it access to NBS‘s 22.5 per cent stake in Fuji and reports said Livedoor is aiming to increase the stake to more than 50 per cent. Livedoor was down 1.2 per cent at Y337.

Tanabe Seiyaku shed 6.2 per cent to Y1,071 after US regulators stopped the trials of a multiple-sclerosis drug it was developing with the UK group GlaxoSmithKline. The FDA halted trials after a patient died after using a similar drug.

Kabu.com Securities, the country‘s fifth-largest broker, climbed 86.1 per cent to Y670,000 as it made its stock market debut. Sega Sammy Holdings firmed 1.4 per cent Y6,350 after the gamemaker said it would pay a special commemorative dividend of Y20 for the full-year to celebrate the founding of the company. Goldman Sachs analyst Ken Uryu said the price earnings ratio of 12 times still looked cheap compared with 17 times for other stocks in the sector.