Japanese stocks fell, led by companies that rely on overseas sales such as Toyota Motor Corp. and NEC Electronics Corp., as a gain in the yen against the dollar threatened to reduce the value of earnings. ``The yen's move against the dollar is encouraging investors in the short term to sell shares of exporters,'' said Masanao Yoshitake, who helps manage $2.5 billion in Japanese equities at Meiji Dresdner Asset Management Co. in Tokyo. He said he plans to reduce his holdings in exporters and increase his stake in banks, declining to name the stocks.
The Nikkei 225 Stock Average slipped 1.3 percent to 11,604.37 as of 2:38 p.m. in Tokyo, while the Topix index lost 1.2 percent to 1172.22. Trading resumed after a three-day holiday. Fuji Photo Film Co. dropped after the world's second- largest maker of camera film said group operating profit will drop this business year. The Morgan Stanley Capital International Asia-Pacific Index, which tracks more than 800 companies in the region, fell 1 percent, its first decline in three sessions. Australia's Leighton Holdings Ltd. is set for its biggest drop in at least 17 years after the construction company cut its profit forecast by a quarter. Samsung Electronics Co., set for its longest losing streak since December 1996, helped push South Korea's Kospi index down 3.1 percent. It was the region's worst performer.
Hong Kong's Hang Seng Index rose, led by mainland shares such as CNOOC Ltd. and PetroChina Co., after the South China Morning Post reported Chinese Premier Wen Jiabao as saying that the government won't slam the brakes on growth. All other benchmarks in the region declined except in Malaysia, Taiwan, India and Sri Lanka. China's stocks markets are closed today for a holiday.
Yen Strengthens
Toyota shed 1 percent to 3,950 yen. The world's largest automaker by market value gets 80 percent of its operating profit from North America. NEC Electronics, the world's biggest maker of semiconductors for mobile-phone displays, declined 2.1 percent to 7,610 yen. ``The yen's gain certainly made shares of automakers and technology-related stocks a bit less attractive in the short term,'' said Minoru Tada, a managing director at World Nichiei Frontier Securities Co. in Tokyo. The yen recently traded at 108.85, strengthening from about 110 yen per dollar at the close of Japanese stock trading last Friday. A stronger yen reduces the value of exporters' dollar- denominated sales.
Mitsubishi Motors
Mitsubishi Motors Corp. sank 5.9 percent to 257 yen. Japan's sole unprofitable carmaker and affiliate Mitsubishi Fuso Truck & Bus Corp. were raided by police investigating whether the automakers falsified reports on faults blamed for 50 accidents and one death, police said. Fuji Photo slumped 5.1 percent to 3,370 yen. Group operating profit will decline 9.1 percent to 164 billion yen ($1.5 billion) this fiscal year. A strengthening yen remains a risk, said Toshio Takahashi, a company director. Fuji Photo predicts a rate of 108 yen to the dollar this year. Brokerages including Deutsche Bank AG, J.P. Morgan Chase & Co. and Goldman, Sachs & Co. cut their ratings on the shares. Leighton plunged 22 percent to A$8.01. Australia's largest construction company said full-year profit would be little changed from last year's A$140 million ($102.5 million) because of delays in construction projects and the closure of a coalmine. That's lower than a February forecast for A$190 million for the year to June.
`Other Problems'
``People will question what other problems are yet to be found and it will have a big impact on investor confidence,'' said Brent Mitchell, an analyst at Shaw Stockbroking in Melbourne who rates Leighton a ``sell.'' In Taiwan, Compal Electronics Inc., the world's second- largest notebook computer maker, added 1.1 percent to NT$37. April sales rose 22 percent from a year ago to NT$14.4 billion ($434 million). Samsung Electronics, the world's No. 2 chipmaker, slid 3.4 percent to 536,000 won. Spot prices of the most-widely used type of computer memory chip may be between $4.95 and $5.25 until May 11, Taiwan-based Dramexchange.com said in a weekly forecast. The so-called double- data-rate chip with 256 megabits of memory which runs at a speed of 333 megahertz was $5.28 today.
Hynix Semiconductor Inc., the fourth-largest chipmaker, declined 5.3 percent to 12,500 won. Rambus Inc., a computer- memory chip designer, filed a lawsuit that claims Hynix, Micron Technology Inc. and Infineon Technologies AG conspired to fix prices and keep Rambus out of the memory-chip market.
Hong Kong
The Hang Seng added 1.2 percent to 12,095.92. Wen said the earlier investment bubbles are pricked, the less the economy will be damaged, the South China Morning Post reported. Still, the government won't slam the brakes on growth, the Post said, citing comments the premier made during his European tour. ``Investors should respond positively to Premier Wen's comments,'' said Frederick Tsang, head of research at China Everbright Ltd. Mainland shares have fallen recently ``because of fears of credit tightening or interest-rate rises in China.'' The Hang Seng China Enterprises Index, which tracks 37 mainland companies, or H shares, jumped 2.1 percent to 4306.42. The H-share index slumped 15 percent last month. The Chinese government last week clamped down on lending to industries it said were expanding too rapidly, including steel, cement, autos and real estate. CNOOC, China's largest offshore oil producer, climbed 1.7 percent to HK$3.025. PetroChina, China's biggest oil producer, gained 2.1 percent to HK$3.65.]
Movers
Among best performers in the region, Denway Motors Ltd., which makes cars in China with Honda Motor Co., jumped 9.4 percent to HK$4.075. Manning Doherty, an analyst at Goldman, Sachs & Co., raised the rating on the stock to ``outperform'' from ``in-line.'' In Australia, Macquarie Infrastructure Group, which owns toll roads in Australia, Europe and the Americas, gained 5.2 percent to A$3.02, after saying average daily toll revenue from its M1 highway in Sydney rose 22 percent to A$148,588 in April from a year earlier. ///www.bloomberg.com