UPDATE: In Quake's Aftermath, Japanese And Nuclear Shares Fall In US
14 Mars 2011 - 7:50PM
Dow Jones News
Japanese company shares trading in New York stumbled Monday as
investors digested the economic impact of last week's earthquake,
and authorities tried to contain radiation from damaged nuclear
reactors.
A closely watched fund that tracks Japanese stocks slid at the
same time that American depository shares of companies like Honda
Motor Co. Ltd. (HMC, 7267.TO), Toyota Motor Corp. (TM, 7203.TO)
Sony Corp. (SNE, 6758.TO) suffered steep declines.
The iShares of MSCI Japan Index Fund (EWJ) fell 8% to $9.94 in
recent trading on the NYSE Arca exchange after losing 1.7% Friday.
Flows of $1.2 billion into the ETF so far in 2011 had been among
the highest in U.S.-listed funds prior to the quake.
"Until Friday this fund was one of the big winners in 2011 in
terms of new money flows," Nicholas Colas, chief market strategist
at BNY ConvergEx said in a report. "How much this trend reverses in
coming days--and where this money goes--will be a useful sign of
investor confidence in Japan."
Shares of auto makers fell after the companies extended halts in
domestic production at least through Wednesday. Honda fell 3.95% to
$38.17 and Toyota dipped 4.3% to $81.31 on the Big Board. Nissan
Motor Co. Ltd. (NSANY, 7201.TO), whose shares trade over the
counter in the U.S., fell 7.1% to $17.65 in recent trading.
Consumer electronics giant Sony Corp.'s shares fell 7.5% to
$30.94 in New York after shutting operations at six manufacturing
plants on Sunday. Computer hardware maker Canon Inc. (CAJ, 7751.TO)
fell 4.8% to $43.36 and Kyocera Corp. (KYO, 6971.TO) traded 5.7%
lower to $92.62.
Hitachi (HIT, 6501.TO) shares shed 15% to trade at $49.95 after
the technology conglomerate announced it had suspended operations
at six manufacturing facilities.
Japanese financial companies also traded lower, with Mizuho
Financial Group Inc. (MFG, 8411.TO) down 8.4% at $3.56, Sumitomo
Mitsui Financial Group Inc. (SMFG, 8316.TO) off 7.1% to $6.40, and
Nomura Holdings Inc. (NMR, 8604.TO) lower by 7.8% at $5.33 on NYSE.
The Nikkei Stock Average plunged 6.2% in Tokyo Monday, its worst
one-day percentage loss since December 2008.
North American stocks tied to uranium production and nuclear
energy tumbled as Japanese authorities struggled to contain
radiation from damaged reactors.
General Electric Co. (GE) led the Dow Jones Industrial Average's
decline with a 3.7% drop. The company designed all six of the
damaged reactors in Japan.
Shares of Canada-based Cameco Corp. (CCJ, CCO.T), the world's
largest publicly traded uranium mining company, fell 15% to $32.31
on the NYSE. Between 10% and 15% of Cameco's sales are to Japan,
according to an estimate from TD Newcrest. The analysts noted that
Japan accounted for approximately 12% of global uranium demand in
2010, and lowered its stock-investment rating on Cameco to "hold"
from "buy."
Nevada-based Uranerz Energy Corp. (URZ) fell 24% to $3.00, and
Texas-based Uranium Resources Inc. (URRE) traded down 26% to $1.71.
Shares of Canada's Uranium Energy Corp. (UEC) fell 23% and Denison
Mines Corp. (DNN, DML.T) fell 22% in U.S. trading.
Global X Uranium ETF (URA), comprised of uranium-miner stocks,
fell 17% to $15.80 on NYSE Arca.
Concerns on Wall Street that Japan's nuclear crises could spur
higher costs and delays for new and existing nuclear plans weighed
on plant operators. Entergy Corp. (ETR) fell 5% to $69.95 and SCANA
Corp. (SCG) dipped 2.9% to $38.89 recently. Bank of America Merrill
Lynch downgraded both stocks to "underperform" from "neutral"
Monday, noting Japan's nuclear crisis could hamper expansion plans
in the U.S.
-By Chris Dieterich, Dow Jones Newswires; 212-416-2611;
christopher.dieterich@dowjones.com
--Yoshio Takahashi and Hiroyuki Kachi contributed to this report
from Tokyo.