4:30 PM Tokyo – In early trading Nikkei fell sharply over 1.5% after the domestic GDP contracted for the second quarter in a row. The economic growth worries were further compounded by the slowdown in the euro zone. J. Front and Takashimaya said October retail sales jumped.
Nikkei index fell sharply over 300 points at the opening in early trading and in volatile trading trimmed losses but the average closed down 1% after the weaker-than-expected GDP report.
Stocks and the yen in Tokyo declined on the rising worries that the export-driven Japanese economy may slow down as the euro zone struggles with the extended period of marginal growth.
The Japan’s economy fell in to technical recession after the gross domestic product contracted in the three months to September, second quarterly decline in a row.
However, the government maintained an upbeat outlook and said the economy continues to recover moderately in the current quarter.
The preliminary figures of gross domestic product in the third-quarter declined 0.8% compared to the revised 0.7% fall in the second-quarter, the Cabinet Office said.
On a seasonally adjusted basis, GDP in the quarter decreased 0.2% from last-quarter.
The retailers J. Front and Takashimaya reported sales in October jumped. Toshiba’s U.S. unit reported impairment charges of about $1.3 billion.
The Nikkei 225 Stock Average dropped 203.22 or 1% to 19,393.69 and the broader Topix index slumped 14.30 to 1,571.53.
The yen weakened to 122.40 against a dollar.
Stocks in Review
J. Front Retailing Co Ltd
declined 3.2% to 1,935 yen after the consumer goods retailer said total sales in October jumped 4.4% but sales in wholesale business plunged 6.2% while sales in credit and other business segment soared 9.2% and 8.7% respectively.
Takashimaya Company, Limited
slipped 2.1% to 1,101 yen after the department store said sales in October soared 9.4% and sales at four regional stores in Okayama, Gifu, Yonago and Takasaki surged 8.9%.
Sales in the Western region climbed 6.4% while sales in the Eastern region jumped 6.7% but total sales in the month advanced 7.2%.
Corporate segment sales surged 65.9% and sales from the cross-media business segment increased 2%.
dropped 2.2% to 288.80 yen after the electronics and industrial conglomerate’s U.S.-based nuclear plant builder Westinghouse Electric Co booked impairment charges of about $1.3 billion in fiscal 2012-2013.