Japan Stocks Slump on Shipping Fees, Oil; Fast Retailing Rises

By Masaki Kondo and Toshiro Hasegawa

Sept. 29 (Bloomberg) -- Japan stocks fell as a record drop in cargo fees for commodities and a decline in oil overshadowed optimism a U.S. bank-rescue plan will soothe financial markets.

Nippon Yusen K.K. lost 6.6 percent, leading shippers to a two-year low. Inpex Holdings Inc., Japan's largest oil and gas explorer, slid 6.1 percent after crude oil dropped for a second day. Fast Retailing Co., operator of Uniqlo clothing stores, surged 5.1 percent as investors sought companies whose earnings are shielded against turmoil in the U.S. financial market.

``Market players are casting doubt about whether the U.S. rescue plan will really work out,'' said Yoshihisa Okamoto, a fund manager at Mizuho Asset Management Co., which oversees $26 billion in Tokyo. ``Investors are focusing more on a worsening global economy and the hazy outlook for corporate earnings.''

The Nikkei 225 Stock Average lost 149.55, or 1.3 percent, to close at 11,743.61 in Tokyo. The broader Topix index slumped 20.02, or 1.7 percent, to 1,127.87. Two stocks declined for each that rose on the Topix.

The Nikkei rose as much as 1.4 percent in the morning session after Congressional leaders and the White House agreed on a package that will give Treasury Secretary Henry Paulson an immediate $250 billion to buy bad loans from financial firms.

Nikkei futures expiring in December slipped 1.3 percent to 11,810 in Osaka and slid 1.4 percent to 11,805 in Singapore.

To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net.