Nikkei Leads Asia-wide Plunge with a Drop of 3%

4:30 PM Tokyo – Market indexes in Tokyo plunged as much as 3% following a sharp turn in the euro zone. Greece imposed capital controls and entered in an unpredictable zone with the prospect of troubled nation leaving the currency union rose.

Markets in Tokyo plunged after Greece imposed capital controls and shunned banks from lending and normal activities after the collapse of weekend talks with European lenders.

Investors sold stocks in Japan and in Asia and sought safety in stronger currencies like yen and in the U.S. dollar.

On the domestic economic front, industrial production declined but retail sales rose.

The seasonally adjusted industrial production in May dropped 2.2% following the 1.2% gain in April, the Ministry of Economy, Trade and Industry reported.

For the year, industrial output declined 4% after 0.1% decrease in the previous month.

In a separate report the Ministry said retail sales in May jumped 3% to 11.77 trillion yen following 4.9% climb in April.

Large-scale sales from large retailers soared 5.3% to 1.69 trillion yen compared to the 8.6% surge in April and wholesale sales jumped 4% to 24.63 trillion yen from in the previous month.

Commercial sales slipped 2.2% to 36.40 trillion yen from 2.5% increase in last month.

The Nikkei 225 Stock Average declined 596.20 or 2.9% to 20,109.95 and the broader Topix index dropped 42.21 or 2.5% to 1,624.82.

The yen closed at 122.76 against a dollar.

Stocks in Review

Kansai Electric Power Co Inc fell 0.7% to 1,349.50 yen after the electric power supplier agreed to acquire the Osaka-based liquefied natural gas-fired power plant in Chiba Prefecture, the first electricity station in the greater Tokyo area.

The exact amount for the thermal power plant operated by Ichihara Power Company and owned by Electric Power Development Co. The KEPCO valued Ichihara Power was not released.

Mitsubishi Heavy Industries Ltd slumped 2.7% to 740.80 yen after the Nikkei business daily reported diversified manufacturer’s unit Mitsubishi Nichiyu Forklift Co is in talk to acquire UniCarriers Holdings for more than 100 billion yen.

The Nikkei added basic agreement will be reached in next month and closed final agreement by later this year.

Nagaileben Co., Ltd slipped 1.8% to 2,394 yen after the medical wear maker reported net sales in the third-quarter ending in May decreased 4.3% to 12.52 billion yen from 13.08 billion yen in a year ago period.

Net income in the quarter dropped 4.2% to 2.58 billion yen compared to 2.69 billion yen and earnings per share fell to 76.13 yen from 78.67 yen.

The company forecasted net sales for the fourth-quarter to jump 3% to 16.70 billion yen and net income to decrease 1.1% to 3.19 billion yen.

Toray Industries Inc decreased 1.6% to 1,016.50 yen after the Nikkei news said diversified textile company’s sales for the first-quarter ending in June to climb 10% to 500 billion yen and may report record operating profit of 50% to about 33 billion yen.

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