Japan Stocks Fall as Commodities Drop; Nikkei Below 10,000

By Masaki Kondo

Oct. 7 (Bloomberg) -- Japan's stocks tumbled, sending the Nikkei 225 Stock Average below 10,000 for the first time since December 2003, as falling demand for metals and oil pointed to a further slowdown in economies across the world.

Itochu Corp., a trading company, sank 4.8 percent. Sanyo Electric Co. lost 5.5 percent after the yen strengthened. Sharp Corp. was poised to dive after cutting its annual earnings forecast. In New York, the Dow Jones Industrial Average dropped 3.6 percent to less than 10,000 for the first time in four years.

``The recent decline in stock markets reflects the severe deterioration of the global economy,'' said Mamoru Shimode, Tokyo-based chief equity strategist at Deutsche Bank AG, in an interview with Bloomberg Television.

The Nikkei Average declined 483.68, or 4.6 percent, to 9,989.41 as of 9:20 a.m. in Tokyo. The broader Topix index fell 51.66, or 5.2 percent, to 947.39.

Crude oil for November delivery tumbled 6.5 percent to $87.81 a barrel in New York, while copper futures for December delivery sank 7.3 percent, the biggest slump since January 2007.

The yen appreciated against the euro to as much as 135.05 yesterday, the strongest since September 2005, while climbing against the dollar to as much as 100.24 from 103.39 at the close of stock trading in Tokyo yesterday.

Nikkei futures expiring in December retreated 3.4 percent to 10,090 in Osaka and slumped 3.9 percent to 10,080 in Singapore.

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