By Masaki Kondo and Patrick Rial
April 28 (Bloomberg) -- Japanese stocks slumped, sending the Topix index to its biggest drop this month, after lower cargo fees drove down shipping lines and the stronger yen diminished the profit outlook for carmakers.
Nippon Yusen K.K., Japan’s No. 1 shipping company, lost 8.3 percent, adding to yesterday’s decline when it said net income would slump 68 percent this year. Toyota Motor Corp. lost 3.4 percent after the yen rose to the strongest this month. Nippon Electric Glass Co. and Nippon Steel Corp. tumbled after saying annual profit dropped by more than half. Daiwabo Co., which makes medical masks, soared 28 percent as the World Health Organization stepped up efforts to curb the spread of swine flu.
The Nikkei 225 Stock Average slid 232.57, or 2.7 percent, to close at 8,493.77 in Tokyo, reversing a 0.9 percent gain. The broader Topix index sank 21.11, or 2.5 percent, to 811.99, the sharpest decline since March 30
“A lot of forecasts for a profit recovery are predicated on an economic rebound in the latter half of the year, which is far from a certainty,” said Hideyuki Ookoshi, who helps oversee $365 million at Chiba-Gin Asset Management in Tokyo. “Now that we’ve had some substantial gains, there aren’t a lot of people willing to buy into the market at the moment until they’re given a fresh reason to do so.”
The Nikkei gained 7.6 percent since the end of March through yesterday, set for the best monthly performance in a year. Two-thirds of the gauge’s members are expected to provide higher dividend yields than the 1.45 percent return on 10-year government bonds, according to Bloomberg data.
To contact the reporters for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net; Patrick Rial in Tokyo at prial@bloomberg.net.
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