Most Japan Shares Fall on Report Lehman Financing Talks Failed

By Patrick Rial

Aug. 21 (Bloomberg) -- Most Japanese stocks declined, led by brokerages and banks, after a report Lehman Brothers Holdings Inc. was unable to complete a share sale and HSBC Holdings Plc slashed ratings on two of Japan's largest banks.

Nomura Holdings Inc., Japan's largest brokerage, lost 1.6 percent after the Financial Times reported Lehman was unable to reach an agreement with South Korean investors to sell a 50 percent stake. Sumitomo Mitsui Financial Group Inc., the nation's No. 2 bank by market value, dropped 1 percent after HSBC said rising credit costs will eat away profit.

Mitsubishi Corp., which gets more than half its profits from commodities trading, gained 3.6 percent after Goldman Sachs Group Inc. predicted oil will rally this year.

The Nikkei 225 Stock Average slipped 63.62, or 0.5 percent, to 12,788.07 as of 9:51 a.m. in Tokyo after gaining as much as 0.3 percent. The broader Topix index declined 7.93, or 0.6 percent, to 1,225.44. Eight shares fell for every five that advanced on the index.

Nikkei futures expiring in September lost 0.4 percent to 12,810 in Osaka and dropped 0.7 percent to 12,810 in Singapore.

To contact the reporter for this story: Patrick Rial in Tokyo at prial@bloomberg.net.