Asian Markets Update: Tokyo Markets Slip, Anticipate Weak Earnings

TOKYO -- Expectations of weak first-quarter earnings from key electronics makers, which will start to release numbers this week, sent key Japanese stock indices lower Monday.

The Nikkei 225 index lost 264.37, or 1.6%, to stand at 16,547.12, while the Topix index, which includes all shares listed on the Tokyo Stock Exchange's first section, shed 18.62, or 1.2%, to close at 1504.81. The the Nikkei over-the-counter index lost 34.55, or 2.0%, finishing at 1671.49.

With the Group of Eight summit yielding little over the weekend, the market took its cue from Friday's performance of the Nasdaq. Shares of Softbank, which invests in about 200 U.S. firms, slipped 650 yen, or 5.5%, to 11,190 ($102.88).

Sentiment was also hurt when traders got hold of talk that Nomura Asset Management's newest mutual fund reportedly had not collected as much money as it previously expected, traders noted. The Strategic Value Open fund has a ceiling of 200 billion yen, but only about half of the total had been garnered, some traders noted.

With first-quarter earnings jitters cramping the style of many investors, large-cap tech shares were shed in earnest, including Sony (SNE Quote), down 190, or 1.8%, to 10,490, Fujitsu, down 100, or 3.1%, to 3100, and NEC (NIPNY Quote) down 45, or 1.5%, to 2995. Many investors are waiting for Sony's results to be released Wednesday before stepping into the market.

The greenback eased slightly against the yen in lethargic trading and recently fetched 108.77.

Weak telecom shares punched Hong Kong's Hang Seng index down 261.17, or 1.5%, to 17,659.69. Index heavyweight China Mobile (CHL Quote) led the way by sliding HK$3.00, or 4.2%, to 68.75 ($8.82), while rival China Unicom (SHU Quote) shed 0.30, or 1.5%, to 20.00.

Hutchison Whampoa slid 1.50, or 1.2%, to 122.00 despite news that Deutsche Telekom(DT Quote) had secured its takeover of U.S. VoiceStream Wireless (VSTR Quote). Hutchison owns a 23% stake in VoiceStream.

Korean stocks were the biggest losers in Asia, with the key Kospi index sliding 45.17, or 5.8%, to 737.89. A tumble in semiconductor shares triggered the downfall, with Samsung Electronics falling KW27,000, or 7.8%, to 319,000 ($286.72). However, as daytraders, who sometimes drum up as much as 40% of the market's total trades, joined in the selling spree, a key psychological level of 770 was broken and depressed sentiment even more. Securities firms were hit the hardest, with Hyundai Securities down 1700, or 15.0%, to 9650 and Daewoo Securities down 1200, or 12.6%, to 8300.