By Masaki Kondo
June 29 (Bloomberg) -- Japanese stocks fell for the first time in four days on plans by Daiwa Securities Group Inc. and Mizuho Financial Group Inc. to sell new shares.
Daiwa, Japan’s No. 2 brokerage, lost 12 percent, the sharpest decline in nine years, after announcing its first public offering in two decades. Mizuho, the third-biggest brokerage by market value, dropped 3.4 percent after people familiar with the deal said the bank may start selling shares as early as this week. Oji Paper Co., the nation’s biggest user of high-sulfur fuel oil, climbed 2.2 percent as oil prices declined.
The Nikkei 225 Stock Average lost 93.92, or 1 percent, to close at 9,783.47 in Tokyo. The broader Topix Index fell 11.48, or 1.2 percent, to 915.32. Two stocks slid for each that rose.
“Revenue from broking remains stagnant, demand for merger and acquisitions won’t recover anytime soon and investment banking isn’t as profitable as before,” said Masaru Hamasaki, a Tokyo-based senior strategist at Toyota Asset Management Co., which oversees $15 billion. “Investors are skeptical Daiwa’s share sale will offset the negative impact of dilution.”
The Nikkei gained 2.7 percent this month, set for a fourth monthly advance, on speculation the worst of the global recession is over. Companies on the gauge traded at 41.7 times estimated net income on June 26, compared with 15.6 times for the Standard & Poor’s 500 Index.
Shares of equipment makers rose in the morning session after a Trade Ministry report on factory output stoked optimism the nation’s economy was recovering. Industrial production rose 5.9 percent in May from the previous month, the Ministry said. Output increased at the same pace in April, which was the biggest gain in a half century.
To contact the reporters for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net.
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