Japan Stocks Fall on Jobs, Credit Suisse ‘Profit Taking’ Call

By Masaki Kondo

Sept. 3 (Bloomberg) -- Japanese stocks fell for a second day, after U.S. employers cut more jobs than estimated and Credit Suisse Group AG recommended investors “take profits.”

Honda Motor Co., a carmaker that generates almost half its sales in North America, sank 2.4 percent. Kawasaki Kisen Kaisha Ltd., Japan’s No. 3 shipping line, lost 1.8 percent after Nomura Holdings Inc. cut its investment rating on the stock. Fast Retailing Co., the operator of Japan’s biggest casual-clothing chain, rose 2.9 percent after Nomura boosted its rating.

“We still haven’t seen signs of growth in consumer spending and corporate investment,” said Kiyoshi Ishigane, a senior strategist at Tokyo-based Mitsubishi UFJ Asset Management Co., which oversees the equivalent of $54 billion. “The lingering recession is increasing non-performing debt globally, keeping investors anxious.”

The Nikkei 225 Stock Average lost 0.6 percent to close at 10,214.64 in Tokyo and the broader Topix index sank 0.7 percent to 942.77, with three times as many shares falling as gaining. The second day of declines ended a streak of gains and losses on alternate days from Aug. 14 to yesterday, the longest such run since at least 1989, according to data compiled by Bloomberg.

Markets have flipped for more than two weeks as investors pondered whether the Nikkei’s rebound this year from a record tumble in 2008 was justified given the prospects for earnings. The trading volume of Nikkei-listed shares stayed below the daily average of the past year in the lead-up to Japan’s Aug. 30 election, which the opposition party won by a landslide.

In New York, the Standard & Poor’s 500 Index lost 0.3 percent yesterday, a fourth-consecutive decline. A survey by ADP Employer Services showed businesses reduced payrolls in August more than economists had estimated.

The Japanese market is set to drop and investors should “take profits” because a better-than-expected reading on U.S. manufacturing failed to lift markets, Credit Suisse Group AG. said yesterday. The Institute of Supply Management’s Purchasing Managers Index reached 52.9 in August, surpassing the 50.5 estimated by economists.

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