Tokyo stocks down 0.40 pct by noon

August 31, 2011 | 09:37

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Tokyo stocks fell 0.40 per cent on Wednesday as a a plunge in US consumer confidence weighed on Japanese exporters, brokers said.

The benchmark Nikkei 225 index lost 35.40 points to 8,918.50 by the lunch break, despite an overnight gain in US stocks on hopes that the Federal Reserve would act to boost the ailing economy.

The Topix index of all first-section issues of the Tokyo Stock Exchange slipped 0.52 points or 0.07 per cent to 766.78.

Exporters such as factory-automation systems maker Fanuc and electronics maker TDK took a hit due to the weak US consumer confidence survey, said Naoki Fujiwara, fund manager at Shinkin Asset Management.

Fanuc fell 0.63 per cent to 12,520 yen and TDK tumbled 2.35 per cent to 3,315.

A key US survey showed Tuesday that consumer confidence plunged in August to the lowest level in more than two years as consumers worried about the economy amid a political standoff over the nation's debt.

Japanese industrial production data for July, showing a weaker-than-expected 0.6 per cent rise from June, had a muted effect on stocks as "it is still in the positive," Fujiwara told Dow Jones Newswires.

The Dow Jones Industrial Average rose 0.18 per cent to end at 11,559.95 Tuesday as the minutes of a Fed August 9 policy meeting showed most members concerned about economic weakness and readily weighing possible stimulus moves.

But "the Fed minutes cannot be a sustainable buying incentive for US stocks," said Yutaka Miura, senior technical analyst at Mizuho Securities.

"Investors will likely remain cautions ahead of upcoming macroeconomic indicators, which are expected to be poor," he said.

Market players have been waiting for manufacturing data on Thursday and jobs data on Friday.

AFP

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