In Tokyo trading Nikkei 225 index slipped 1.71% or 264.72 to 15,249.79, while the broader Topix Index fell 28.55 to 1,472.70. Asian markets across the region fell. Hong Kong, Australia, Singapore, Taiwan, and India lost more than 3%.

In the first section of the Tokyo Stock Exchange 7.4 billion shares valued at 936 billion yen were traded and in the second section 366 million shares valued at 66 billion yen changed hands.

Of the Nikkei 225 stocks 22 gained, 200 declined, and 3 were unchanged. 22 stocks shed 4%. Tokai Carbon Company led decliners with a slump of 8.65% as domestic-oriented stocks fell after demand for services rose 1.1% in October.

Japan’s Ministry of Economy Trade and Industry said that the Indices for Tertiary Industrial Activity rose 1.1% to a seasonally adjusted 1.1% in October. Economists had forecasted a 1.2% increase.

Demand for information and communications jumped 6.1% as financial institutions installed new computer systems. Wholesale and trade firmed 2.0%, finance and insurance climbed 2.8%, services gained 0.8% and real estate inched 0.3% higher.

However METI figures showed demand for eating, drinking and accommodation slumped 2.8%, learning support plunged 12.0%, medical, healthcare and welfare tumbled 1.5%, electricity, gas, heat supply and water declined 1.8%, compound services declined 3.9% and transport retreated 0.9%.

Kyodo news reported today that Japan’s Finance Ministry has initiated preparations to set its draft state budget for fiscal 2008 at more than 83 trillion yen, up from 82.91 trillion.

Bloomberg news said today that the Japan Bank for International Cooperation will lead $3 billion to Abu Dhabi National Oil Company for oil exploration, the construction of pipelines and facilities to increase crude oil output. A third of the amount was raised from Mizuho Financial Group and other financial institutions.

The loan agreement is expected to be signed this week when ADNOC Chief Executive Yousef Omair Bin Yousef and Abu Dhabi Crown Prince Mohammad Bin Zayed Al Nahyan are in Tokyo.

Of the Nikkei 225 index shares Shin-Etsu Chemical Company led advancers with a rise of 3.01% followed by gains in Nippon Oil Corporation of 2.74%, in Alps Electric Company Limited of 2.01%, in Kikkoman Corporation of 1.43%, and in Kansai Electric Power of 1.28%.

Exporters pared losses as the yen weakened from 112.44 last week to 113.05 to the dollar at the close of trade today. Canon rose 0.36% and Hino Motors Limited firmed 1.14%.

Tokai Carbon Company led retreating Nikkei 225 index shares with a fall of 8.65% followed by losses of 7.35% in Sumco Corp, 7.15% in Okama Corp, 6.71% in Shimizu Corporation, and 6.63% in Dowa Holdings.

Financial institutions also declined after Nomura Holdings said that request by the U.S. for banks to contribute $5 billion credit lines for a fund to bailout institutions was an “excessive burden”. Mitsubishi UFJ Financial Group tumbled 4.28%, Mizuho Financial Group slipped 4.99% and Mitsui Sumitomo Financial Group edged down 1.05%. The news first reported by Nikkei News hurt the trading sentiment and led the Nikkei and broader index Topix lower.

Pharmaceutical companies also retreated on Nikkei reports that Japan’s Health Ministry will reduce by more than 1% the amount of money it pays for drugs out of the national health plan, forcing drug makers to reduce prices. Takeda Pharmaceutical fell 1.78% and Astellas Pharmaceuticals declined 1.81%.

Japan Today reported yesterday that Komatsu will spend 6.9 billion yen to build a forklift and construction machinery plant in Yaroslavl, Russia. The plant is scheduled to begin operations in June 2010.

Separately, the online daily reported yesterday that non-life insurer Millea Holdings will acquire British insurer Kiln Limited for 442 million pounds in a bid to expand operations abroad. The operations would be conducted through the wholly owned subsidiary Tokio Marine & Nichido Fire Insurance Company.

Nikkei news reported Sunday that Toyota Motor Corp plans to raise global unit production to 9.9 million in 2008, up by more than 500,000 units projected for the current year.


3:00AM New York, 7:00PM Sydney- ASX 200 index declined 3.5% on regional weakness in financial stocks and BHP halted its stock buy-back to meet regulatory requirements.

ASX 200 index sharply declined 3.5% or 228.2 to close at 6,263.50. BHP and Rio Tinto both shed 2.8%.