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TOKYO -- Japanese shares clawed out of a hole as the

Nikkei 225

index fell below a key psychological support level of 15,500 during the trading session before making an upward move to finish at 15,727.49

Overall, the Nikkei 225 index, however, shed 111.08, or 0.70% to finish at 15,727.49, while the


index, which includes all shares listed on the

Tokyo Stock Exchange's

first section, inched up 0.22, at 1453.15. The


small-cap index lost 1.64, or 2.2%, at 71.95, while the Nikkei


index shed 36.98, or 2.3%, at 1549.09.

Sentiment overall is rather weak following a banking scandal forced the head of Japan's bank watchdog group to resign. Head of the

Financial Reconstruction Commission

Kimitaka Kuze resigned over the weekend after the media blasted him for taking bribes from

Mitsubishi Trust & Banking

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, as well as construction firm


while he was a member of


. Shares of Daikyo fell 11 yen, or 4.8%, to 220 ($2.00).

Large-cap tech shares were mixed, with


(SNE) - Get Sony Corp. Report

falling 110 yen, or 1.1%, to 10,070,


finished flat at 9150 and



climbed 230, or 8.1%, to 3080.

Nomura Securities


rose 135, or 6.7%, at 2145 after the firm reported late Friday that first-quarter net profits jumped 516% from the same period last year to 64.40 billion yen.

The greenback edged slightly higher against the yen to recently fetch 109.50. Many currency dealers say the dollar has a chance to climb to 112.00 over the next month or so, or as long as the stock market remains bogged down.

With rate worries fresh in investors' minds once again, Hong Kong's

Hang Seng

index dropped 342.95, or 2.0%, at 16,840.98. With the territory's currency pegged to the U.S. dollar, any rate rise stateside means higher rates at home. Bank and property shares were hit, including



, down HK$2.00, or 1.9%, at 101.50,

Bank of East Asia


, down 0.35, or 1.9%, at 17.65 and

Cheung Kong

, down 1.75, or 1.9%, at 92.00.

Telecom firms were also depressed, with

China Mobile

(CHL) - Get China Mobile Ltd. Report

losing 1.50, or 2.3%, at 62.75 and

Hutchison Whampoa


declining 3.00, or 2.7%, at 109.00.

Elsewhere in Asia, Korea's


index gained 13.32, or 1.9%, at 705.97, while Taiwan's


index shed 29.01 at 8114.92.