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Japan Stocks Fall After Yen Gains, China Raises Reserve Quotas|
April 18 (Bloomberg) -- Japanese stocks dropped for a second day led by exporters as the yen advanced and after China raised banks’ reserve requirements, limiting growth in Japan’s biggest overseas market.
Sony Corp., Japan’s No. 1 exporter of consumer electronics, lost 1 percent. Canon Inc. sank 1.2 percent after the yen gained, cutting the earnings outlook for the camera maker that gets about 80 percent of its sales overseas. TDK Corp., a manufacturer of electronic parts which gets almost a third of its revenue from China, declined 2.8 percent.
“There’s too much uncertainty for investors to be confident enough to take positions,” said Koichi Kurose, chief strategist in Tokyo at Resona Bank Ltd., which oversees the equivalent of $57 billion in assets. In China, “the tightening measures are dragging on, and this isn’t good for stocks or the economy.”
The Nikkei 225 Stock Average fell 0.2 percent to 9,573.04 at the 11 a.m. trading break in Tokyo, while the Topix dropped 0.2 percent to 839.25. The Topix has declined more than 8 percent since a magnitude-9 earthquake and tsunami on March 11 devastated Japan’s northeast coast and crippled a nuclear power plant.
Yen Hurts Exporters
The yen appreciated to as high as 82.86 against the dollar today in Tokyo, compared with 83.23 at the close of trading on April 15. Against the euro, Japan’s currency strengthened to 118.94 from 120.42. A stronger yen reduces overseas income at Japanese companies when repatriated.
TDK, which counts China as its largest market, sank 2.8 percent to 4,345 yen. Komatsu Ltd. a maker of construction equipment that has benefited from China’s building boom, fell 3 percent to 750 yen following measures by China’s central bank on April 15 to cool investment and tame inflation.
China increased banks’ reserve requirements to lock up cash and cool price gains after the world’s second-largest economy showed signs of overheating. Inflation accelerated to 5.4 percent, the most since July 2008, the statistics bureau said April 15.
-- with assistance from Satoshi Kawano in Tokyo. Editors: Jason Clenfield, Nick Gentle.