Share prices closed lower on profit-taking after yesterday's sharp surge in prices, dealers said. However with optimism over the economy prevailing, the downside for the market is expected to be fairly short-lived, they said. The Nikkei 225 Stock Average ended the day down 48.95 points or 0.4 pct at 13,689.89. Yesterday, it ended at 13,738.84, the highest close since May 29, 2001 when it settled at 13,773.89. The broader-based TOPIX index of all First Section issues fell 12.16 points or 0.9 pct to 1,409.67. Losers beat gainers 1,158 to 424, with 81 issues unchanged. Volume reached 2.9 bln shares, down from 3.1 bln yesterday. Dealers said yesterday's price jump and a slump on Wall Street overnight weighed on sentiment today. "For one thing, the market surged excessively yesterday, and for the other, US stocks were bad," Mitsushige Akino, a chief fund manager at Ichiyoshi Investment Management said. However he noted that the sell-off was limited "because foreigners, and some domestic investors, both institutional and individual, are still buying." While the results of the latest Tankan business survey fell below market expectations, they "still showed that Japan is on a mild recovery path." Other recent data, although mixed, broadly support the view that the economy has firmly emerged from its lull earlier in the year. "So, I believe this (rising) market trend will continue with prices edging up little by little," Akino said. In the chip sector, Fujitsu closed down 3 yen at 811, Oki Electric Industry dipped 11 yen or 2.6 pct to 409, Toshiba lost 6 yen to 529 and Hitachi fell 9 yen to 757 while Elpida Memory dropped 70 yen or 2.0 pct to 3,510. Shipbuilders were sluggish as Mitsubihsi Heavy Industries fell 13 yen or 3.3 pct to 381, Sumitomo Heavy Industries dropped 38 yen or 5.0 pct to 723, Kawasaki Heavy Industries shed 10 yen or 3.5 pct to 275 and Hitachi Zosen dipped 8 yen or 4.0 pct to 190. The trading house sector suffered, with Mitsubishi down 45 yen or 2.1 pct at 2,140, Marubeni declining 9 yen or 1.75 pct at 505, Sojitz off 25 yen or 3.9 pct at 616 and Tomen falling 5 yen or 2.4 pct at 206.